BLUE SEA: First Creditors' Meeting Set for March 1--------------------------------------------------A first meeting of the creditors in the proceedings of Blue SeaCranes Pty Ltd will be held at the offices of Hall Chadwick,Level 1, Paspalis Business Centre, 48-50 Smith Street, inDarwin, NT, on March 1, 2017, at 10:00 a.m.

Kathleen Vouris, Cameron Shaw and Richard Albarran of HallChadwick were appointed as administrators of Blue Sea on Feb. 17,2017.

NATIONAL DAIRY: Administrators May Pursue Owner for AUD4.3 Mil.---------------------------------------------------------------Peter Hemphill at The Weekly Times reports that National DairyProducts' administrators may pursue the milk company's owner TonyEsposito for AUD4.3 million in "voidable transactions" if it isforced into liquidation this week.

The Weekly Times relates that in a report sent to creditors lastweek, NDP administrators Glen Kanevsky and Salvatore Algeri, ofDeloitte, identified AUD4,343,339 in voidable transactions thatcould be recovered from Mr. Esposito -- but only if the companywas placed in liquidation.

According to the Weekly Times, the administrators recommend tocreditors that NDP be wound up, given that Mr. Esposito anddirector partner Violetta Esposito have withdrawn the Deed ofCompany Arrangement that would have seen creditors get AUD521,000to settle debts of up to AUD17.8 million.

Mr. Kanevsky and Mr. Algeri said no other DoCA had been proposedand they did not expect another to be offered prior to Feb. 15meeting, the Weekly Times relays.

The report to creditors identified "optimistic" and "pessimistic"scenarios in the recovery of money to creditors if NDP is woundup, the Weekly Time reports.

Aside from the AUD4.3 million in voidable transactions under an"optimistic" scenario, the administrators identify the potentialto recoup AUD750,000 in associated costs from the Espositos, butit could cost up as much as AUD1.74 million to pursue the action,the Weekly Times says.

The ratings take into account, among other factors, evaluation ofthe underlying receivables and their expected performance, theevaluation of the capital structure, the availability of excessspread over the life of the transaction, the liquidity reserve inthe amount of 1.50% of the note balance, the interest rate swapsprovided by Commonwealth Bank of Australia ('CBA', Aa2/P-1/Aa1(cr)/P-1(cr)) and National Australia Bank Limited ('NAB',Aa2/P-1/Aa1(cr)/P-1(cr)), the experience of Flexirent Capital PtyLimited as servicer and the back-up servicing arrangements withDun & Bradstreet (Australia) Pty Limited.

Initially, Class A notes (which include Class A1, Class A2 andA2-G), Class B, Class C, Class D and Class E notes benefit from22.5%, 17.4%, 11.5%, 7.5% and 5.0% of note subordination,respectively. The notes will be repaid on a sequential basisuntil the later of: (1) repayment of the Class A1 short-termtranche, and (2) increase in the subordination to Class A notesto 25% from 22.5%.

The notes will also be repaid on a sequential basis if there areany unreimbursed charge-offs or the pool amortises to below 10%of the original balance. At all other times, the structure willfollow a pro-rata repayment profile (assuming pro-rata conditionsare still satisfied).

The transaction features a short term P-1 (sf) rated tranche,with a legal final maturity of 12 months from issuance. Thetranche represents 34.7% of the total issuance. Key factorssupporting the P-1 (sf) rating include:

- Principal cashflows -- which will be allocated to the short-term tranche in priority to other tranches until it is fullyrepaid -- will be sufficient to amortise the tranche within the12-month period. The amortisation is tested with no prepaymentand assuming a P-1-commensurate level of defaults anddelinquencies occurring during the amortisation period.

The principal methodology used in these ratings was "Moody'sApproach to Rating Consumer Loan-Backed ABS" published inSeptember 2015.

Factors That Would Lead to an Upgrade or Downgrade of theRatings:

Up

Levels of credit protection that are greater than necessary toprotect investors against current expectations of loss could leadto an upgrade of the rating. Moody's current expectations of losscould be better than its original expectations because of fewerdefaults by underlying obligors. The Australian job market is aprimary driver of performance.

Down

Levels of credit protection that are insufficient to protectinvestors against current expectations of loss could lead to adowngrade of the ratings. Moody's current expectations of losscould be worse than its original expectations because of moredefaults by underlying obligors. The Australian job market is aprimary driver of performance. Other reasons for worseperformance than Moody's expects include poor servicing, error onthe part of transaction parties, a deterioration in creditquality of transaction counterparties, lack of transactionalgovernance and fraud.

Moody's Parameter Sensitivities

If the default rate rises to 4% (1.4 times Moody's assumption of2.8%) then the model-indicated rating for the Class A2 Notesdrops two notches to Aa2. Similarly, the model-indicated ratingfor the Class B Notes, Class C Notes, Class D Notes and E Notesdrop four, three, three and three notches to A3, Baa2, Ba2 and B1respectively under this scenario.

SWITCHGEAR COMMISSIONING: First Creditors' Meeting Set March 1--------------------------------------------------------------A first meeting of the creditors in the proceedings of SwitchgearCommissioning & Maintenance Engineers Pty Ltd will be held atLevel 3, 95 Macquarie Street, in Parramatta, NSW, on March 1,2017, at 11:00 a.m.

Suelen McCallum and Riad Tayeh of de Vries Tayeh were appointedas administrators of Switchgear Commissioning on Feb. 17, 2017.

Fitch has also assigned Xinhu (BVI) Holding Company Limited'sproposed US dollar notes a 'B(EXP)' expected rating, with aRecovery Rating of 'RR4'. Xinhu (BVI) is a fully owned subsidiaryof Xinhu Zhongbao, which will unconditionally and irrevocablyguarantee the notes. The notes are rated at the same level asXinhu Zhongbao's senior unsecured debt as they will represent itsdirect, unconditional, unsecured and unsubordinated obligations.The final rating on the proposed notes is contingent upon thereceipt of documents conforming to information already received.

KEY RATING DRIVERSHigh Leverage Constrains Ratings: Xinhu Zhongbao has reportedpersistently high leverage of 60%-70%, as measured by netdebt/adjusted inventory, if including financial joint ventureinvestments. However, the high leverage is due to its 'primaryland development and secondary property development' businessmodel, which helps keep land costs low. This gives the companyroom to deleverage by lowering pressure for new land acquisitionsor by introducing partners to its existing Shanghai projects.Furthermore, Xinhu Zhongbao significant investment in financialinstitutions means its leverage is higher than most otherhomebuilders that solely focus on the property developmentbusiness.

Slower Turnover than Peers: Xinhu Zhongbao's project churn of0.3x in 2015, as measured by contracted sales/net inventory, islow compared with the 0.6x average of 'B' rated peers. Fitchexpects most of the primary land development costs to occur inthe next year or two, which will push up inventory levels, whilecontracted sales will kick in and cover property developmentcosts from late 2018.

Quality Landbank: The majority of the landbank Xinhu Zhongbao hasfor secondary developments are in key cities around the YangtzeRiver Delta, with 25% of its sellable resources by value locatedwithin the Shanghai inner-ring that benefits from limited supply.This supports an increase of Xinhu Zhongbao's future averageselling prices (ASP) by more than 50% when the Shanghai projectsare launched in 2018 or 2019, from CNY11,061 per square metre in2015.

Sales Growth and Margin Improvement: Fitch expects XinhuZhongbao's high land quality to support robust contracted salesgrowth and higher margins. Fitch forecasts increase in ASPs willdrive the company's gross profit margin above 30% when Shanghaiproject sales are recognised in 2019, from its 2015 EBITDA marginof 23%. However, Fitch foresee a lower EBITDA margin for 2016 and2017 due to higher construction, land and selling, general andadministrative expenses, as the economies of scale arising fromincreased sales from its better-quality projects will not kick-inuntil 2018.

Financial Investments Given Credit: Xinhu Zhongbao has beenbuilding up its portfolio of long-term equity investments infinancial institutions, mainly in Xiangcai Securities Co., Ltd.,Shengjing Bank, Bank of Wenzhou Co Ltd and China CITIC BankCorporation Limited (BBB/Stable). Fitch has included these long-term investments into Fitch leverages calculation as part ofadjusted inventories. Fitch also adjusted Xinhu Zhongbao's netdebt to include a cash credit from its marketable equityinvestments. The company has constantly made large marketableequity investments in the Chinese and Hong Kong equity markets.

DERIVATION SUMMARYXinhu Zhongbao's ratings are supported by its high land quality,which will drive robust contracted sales growth and highermargins. Its ratings are mainly constrained by high leverage.

Xinhu Zhongbao has a similar business model and contracted salesscale to Oceanwide Holdings Co. Ltd. (B/Stable). Both companieshave slow churn as measured by contracted sales/total debt. XinhuZhongbao has lower leverage, while Oceanwide has a strongerEBITDA margin and higher equity investment in financialinstitutions.

KEY ASSUMPTIONSFitch's key assumptions within Fitch ratings case for the issuerinclude: - No new land acquisitions in 2017 or 2018 and limited new land acquisition thereafter. - Contracted sales gross floor area increasing by 20% in 2016/2017, then slowing once sales from the new Shanghai projects begin in 2018/2019. - A mild increase in ASPs in 2016/2017, then jumping up in 2018/2019 as the contribution of contracted sales from Shanghai increases. - A 90% property contracted sales cash collection ratio. - A lower EBITDA margin in 2016/2017 due to higher construction and land costs, followed by a margin rebound in 2018 when better-quality projects are recognised.

LIQUIDITYXinhu Zhongbao has tight liquidity, but Fitch do not foresee aliquidity shortage in 2017. The company's cash and marketablesecurities totalled CNY20bn in 1H16 after Fitch's took a 60%haircut to its CNY9bn marketable equity investments based on theagency's rating methodology. Xinhu Zhongbao can cover short-termdebt of around CNY22bn plus the CNY6bn negative FCF forecast,with support from its CNY9bn available undrawn bank facility. Inaddition, the company's high quality and sufficient land reserveprovides an adequate pledge for financing if necessary.

XINHU ZHONGBAO: Moody's Assigns B2 Corporate Family Rating-----------------------------------------------------------Moody's Investors Service has assigned a first-time B2 corporatefamily rating to Xinhu Zhongbao Co., Ltd. and a (P)B3 seniorunsecured rating to the proposed USD notes to be issued by Xinhu(BVI) Holding Company Limited, a subsidiary of Xinhu Zhongbao.The proposed notes will be guaranteed by Xinhu Zhongbao.

The ratings outlook is stable.

Moody's will remove the provisional status of the notes ratingafter the new notes have been issued on satisfactory terms andconditions and registered with the relevant authorities.

The company plans to use the proceeds of the new notes forgeneral corporate purposes, such as refinancing existing debt andreplenishing working capital.

RATINGS RATIONALE

"Xinhu Zhongbao's B2 corporate family rating reflects thecompany's good track record in sales execution on residentialproperties in the Yangtze River Delta, and the higher-than-peeraverage gross profit margin for its property developments," saysFranco Leung, a Moody's Vice President and Senior Credit Officer.

Xinhu Zhongbao's strong execution capability is evident in itsstrong annual sales growth - which has averaged more than 40%over the past two years - supported by well-located projects inregions with strong property demand, as well as the diversity inits product mix and designs. Such factors meet customer needs.

Xinhu Zhongbao generated around 89% and 83% of its contractedsales value in 1H 2016 and 2015 respectively from the YangtzeRiver Delta.

Moody's expects that this region will continue to contribute tothe majority of its sales in the coming two years, because itrepresented around 77% of Xinhu Zhongbao's total land bank bygross floor area at end-June 2016.

The company's relatively low-cost land bank - benefiting from itslegacy land bank and redevelopment projects - also contributed toits high property development gross profit margin of around 32%-40% in 2013-2015. Moody's expects that this margin will fall to28%-35% over the next 18-24 months, but such a level is stillhigh when compared to its Chinese rated industry peers.

On the other hand, its B2 corporate family rating is constrainedby its commodity trading business, which contributed 32%-43% ofrevenue in 2012-2015, but only registered a less than 1% grossmargin, and could be subject to volatile commodity prices.

Nevertheless, the risk of such volatility is partly mitigated bythe company's policy of conducting trading on a back-to-backbasis, and Moody's expectation that the significance of thisbusiness will fall, if Xinhu Zhongbao successfully grows itsresidential development business.

In addition, the company's B2 corporate family rating isconstrained by its weak financial metrics, which arise from itsdebt-funded investments in various financial institutions andother businesses.

Xinhu Zhongbao has been active in acquiring equity stakes infinancial services, as well as internet and financial technologycompanies. For example, it acquired a 4.8% stake in China CITICBank Corporation Limited (Baa2 stable), valued at around RMB10billion in 2015.

As a result, debt leverage - as measured by revenue/adjusted debt- was weak at around 25%-32% in 2013-2015, driven also by itsdebt-funded strategy on land acquisitions and the capitalrequirements for its redevelopment projects, as well as the longdevelopment cycles for its property redevelopment projects.

Its interest coverage was also weak at 1.3x-1.4x over the sameperiod. Moody's expects that the company will continue todemonstrate high debt leverage and revenue/debt of around 30%-33%over the next 12-18 months, while interest coverage will trendtowards 1.6x-1.7x, which is comparable to other B2-rated Chineseproperty developer peers.

The company's cash balance of around RMB14.9 billion at 30 June2016 and operating cash flow are inadequate to cover short-termdebt of around RMB16.7 billion and estimated land payments andrelocation costs of around RMB8 billion for the 12 months to end-June 2017.

Nonetheless, Moody's estimates that Xinhu Zhongbao had liquidunpledged listed securities of around RMB5 billion at end-June2016, which could become an alternative source of liquidity tosupport its funding needs.

Moreover, Xinhu Zhongbao was one of the early issuers of onshorebonds in 2008. At 30 September 2016, the company's debtcomposition was diversified, comprising onshore bank loans (44%),domestic bonds (31%) and other loans, including trust loans(25%).

The (P)B3 rating of Xinhu Zhongbao's senior unsecured notes isone notch lower than its corporate family rating, reflectinglegal subordination risk. The company has a high level of securedborrowings, which accounted for an estimated 30% of total assetsat 30 June 2016. Moody's expects the ratio to remain above 20%over the next 12-18 months. This situation poses legalsubordination risk to unsecured creditors at the holding companylevel.

The ratings outlook is stable, reflecting Moody's expectationthat Xinhu Zhongbao will meet its contracted sales target,successfully refinance its short-term debt, and adopt adisciplined approach in land acquisitions and financialinvestments.

The principal methodology used in these ratings was HomebuildingAnd Property Development Industry published in April 2015.

Xinhu Zhongbao Co., Ltd. was founded in 1992 and is headquarteredin Hangzhou. It commenced its first residential property projectin Wenzhou, Zhejiang Province, in early 1990. Its operations aremainly focused on residential property development. In addition,it invests in financial services, internet and information-related companies, and is engaged in commodity trading.

At the same time, S&P assigned its foreign currency 'B-' long-term issue rating and 'cnB+' long-term Greater China regionalscale rating to a proposed issue of U.S. dollar-denominatedsenior unsecured notes by Xinhu (BVI) Holding Co. Ltd., asubsidiary of Xinhu Zhongbao Co. Ltd. The parent unconditionallyand irrevocably guarantees the notes. The rating on the proposednotes is subject to S&P's review of the final issuancedocumentation.

"The rating reflects our view that Xinhu Zhongbao has highfinancial leverage, a long project execution cycle, and a smallalbeit gradually growing operating scale. Nevertheless, theseweaknesses are tempered by the company's large financialinvestment portfolio, which could provide additional financialflexibility if needed," said S&P Global Ratings credit analystDennis Lee.

In addition, the company's high-quality land reserves in Shanghaiunderpin future growth.

In S&P's view, Xinhu Zhongbao's high leverage is attributable toits slow sales execution, long development cycle in its urbanredevelopment projects in Shanghai, and a substantial amount offinancial investments, which have tied up capital. S&P expectsXinhu Zhongbao will accelerate its contracted sales, control landacquisitions, and prudently manage the expansion in financialinvestments in the next two years. In S&P's base case, itforecasts EBITDA interest coverage will increase to about 1.0x in2016 and 2017, from 0.83x in 2015, while the debt-to-EBITDA ratioremained at about 15x in 2016 and will improve to 13x in 2017.

S&P expects the developer's contracted sales reached Chineserenminbi (RMB) 15 billion-RMB16 billion in 2016, and will grow afurther 10% in 2017, compared with RMB10.5 billion in 2015. Thematerial increase in 2016 is driven by improved marketconditions, price surges in higher-tier cities, and the company'snew project launch in the inner ring of Shanghai. For 2017, S&Pexpects contracted sales will be mainly supported by projects inthe Zhejiang and Jiangsu provinces, as new phases of itsdevelopments in Shanghai are unlikely to be launched before 2018.

Xinhu Zhongbao's large and high-quality land reserves in Shanghaisupport its credit profile. The company currently has five urbanredevelopment (UR) projects in the inner ring of Shanghai, with atotal construction area of more than 1 million square meters(sqm). S&P believes these projects will support sales growth andmargins in the next few years.

However, three of the UR projects were acquired in the past twoyears, and considering the relocation process usually takes morethan two years, the sales and revenue contributions of newprojects are unlikely in the next one to two years. Relocationsfor the two existing projects are nearly complete, andconstruction of the new phases will start in 2017 with salescommencing in 2018. Xinhu Zhongbao had total land reserves ofabout 12 million sqm as of June 30, 2016, which are in Shanghaiand spread over various cities in Zhejiang and Jiangsu provinces.

Xinhu Zhongbao will likely continue to expand its equitiesinvestments in a disciplined manner, with net spending ofRMB2 billion per year. As of Sept. 30, 2016, the company hadavailable-for-sale securities and long-term investments ofRMB18.1 billion, consisting mainly of minority shareholdings infinance-related listed and private companies.

S&P do not anticipate the company will invest aggressively infinancial-related holdings or acquire controlling interests innon-property related companies, resulting in a furthersignificant increase in financial leverage. S&P expects XinhuZhongbao to maintain a flexible approach to its investments,which includes a willingness to dispose of assets and repay debtto improve its financial leverage if needed.

In S&P's view, the high proportion of short-term borrowingsweakens the company's liquidity and capital structure. As ofSept. 30, 2016, Xinhu Zhongbao had short-term borrowings ofRMB13.17 billion, which made up about 26% of its total debt.Some of this short-term debt included trust financings andborrowings from asset management companies. The borrowings fromtrust and asset management companies accounted for RMB12.6billion, or 25.1% of its total debt. The debt-mix risk ispartially tempered by the company's adequate cash balances,growing contracted sales, and financial investment portfolio.

Xinhu Zhongbao has a trading segment which generated aboutRMB4 billion of revenue in the past two years. The trade flowsare fully back-to-back and the company carries no inventory,price or counterparty risk. In 2011-2015, the segment's grossmargin ranged from 0.1%-0.4%. This business does not affectS&P's assessment of the company's credit profile given its lowrisk, pass-through nature.

The rating of the guaranteed notes is one notch lower than thelong-term corporate credit rating on Xinhu Zhongbao to reflectstructural subordination risk. Xinhu Zhongbao intends to use theproceeds for general corporate purposes.

The stable outlook reflects S&P's view that Xinhu Zhongbao willcontinue to operate under high leverage while steadily increasingcontracted sales in the coming 12 months. S&P expects thecompany to maintain large financial investments but to limit theexpansion of its non-property-development sectors. S&P alsoanticipates that Xinhu Zhongbao could rely on its cash on hand,growing contracted sales, liquid investments, and otherborrowings to fulfill its relatively high short-term borrowings.In S&P's base case, it forecasts that EBITDA interest coveragewill improve to about 1.0x in 2016 and slightly over 1.0x in2017.

S&P could lower the rating if Xinhu Zhongbao's leverage increasesdue to slow project execution or aggressive expansion, such thatits EBITDA coverage ratio does not improve to 1.0x in the next12-18 months. S&P could also lower the rating if it believesthat Xinhu Zhongbao is experiencing any difficulties inrefinancing its short-term borrowings.

An upside scenario is unlikely in the coming 12 months.Nevertheless, S&P may consider raising the rating if XinhuZhongbao's leverage and interest coverage substantially improve.This could happen if contracted sales materially exceed S&P'sforecast, or the company sells a substantial portion of itsfinancial investments for debt repayment.

The ratings reflect ARGM's modest scale and working capitalintensive operations in the highly fragmented agro industry. Theratings also factor in a below-average financial risk profile,with an average capital structure and subdued debt protectionmetrics. These weaknesses are partially offset by the extensiveexperience of proprietor in the agro industry.

Key Rating Drivers & Detailed DescriptionWeaknesses* Modest scale of operations: Scale is small as indicated bymodest revenues of INR4.7 crore in fiscal 2016. While scale isexpected to improve substantially during fiscal 2017, it wouldcontinue to constrain the business risk profile over the mediumterm.

* Large working capital requirement: Sizeable gross currentassets of 318 days as on March 31, 2016, driven by largeinventory of 246 days and debtors of 111 days, reflect workingcapital-intensive operations.

Strength* Extensive experience of proprietor: Over his decade-longexperience, the promoter established longstanding relationshipswith customers and suppliers. Benefits derived from hisexperience will continue to support the business.Outlook: Stable

CRISIL believes ARGM will continue to benefit over the mediumterm from the promoter's experience. The outlook may be revisedto 'Positive' 'Positive' in case of a significant increase inrevenue while profitability is maintained, leading to higher cashaccrual and hence, a better financial risk profile. Conversely,the outlook may be revised to 'Negative' if large, debt-fundedexpansions, sharp decline in revenue and profitability, orsizeable capital withdrawal weaken financial risk profile.

Set up in 2005 and promoted by Mr. Amit Gupta, Karnal-based ARGMmills and sells basmati and non-basmati rice.

The ratings reflect BADDI's limited operational track recordsince it commenced operations from September 2015. The ratingsfurther factor in the expected small scale of operations of INR20million-30 million in FY17, with weak interest coverage(operating EBITDA/gross interest expense) of 1.3x-1.5x and netleverage (total adjusted net debt/operating EBITDA) of 4x-5x.

However, the ratings are supported by the promoters' more thantwo decades of experience in the same line of business.

RATING SENSITIVITIES

Positive: A sustained improvement in the overall revenue andprofitability, leading to an improvement in the credit metricswill be positive for the ratings.

COMPANY PROFILE

Incorporated in 2010 as a special purpose vehicle of BBNIndustries Association and BBN Development Authority, BADDIimplements projects sanctioned under the government's recastindustrial infrastructure scheme. The projects currentlyundertaken by the company are Common Effluent Treatment Plant atvillage Kenduwal, Baddi and Baddi Technical Training Institute -Private ITI at Jharmajri, Baddi.

CRISIL has treated unsecured loans of INR1.91 crores as neitherdebt nor equity as these are extended to the company by promotersand are expected to remain in the business over the medium term.

Key Rating Drivers & Detailed DescriptionWeaknesses* Below-average financial risk profile: The financial riskprofile is below average, with high total outside liabilities totangible networth ratio of 3.82 times and weak debt protectionmetrics, with interest cover and net cash accrual to total debtratios of 1.67 times and 0.09 time, respectively, in fiscal 2016.

* Modest scale of operations and susceptibility to intensecompetition: The scale of operations is modest, with operatingincome of INR34.2 crore in fiscal 2016. BLPL operates in anindustry wherein entry barriers are low due to small capitalrequirement; this has resulted in the presence of manyunorganised players in the timber industry, leading to intensecompetition, modest scale and low profitability.

Strength* Promoters' extensive experience in timber trading: Thepromoters have been engaged in a timber trading since more than adecade and have significantly enhanced BLPL's reach in thedomestic market.Outlook: Stable

CRISIL believes BLPL will continue to benefit over the mediumterm from its promoters' extensive experience. The outlook may berevised to 'Positive' in case of a substantial improvement inscale of operations and increase in cash accrual or in case ofimprovement in the capital structure led by equity infusion.Conversely, the outlook may be revised to 'Negative' if anylarge, debt-funded capital expenditure, or a steep decline inprofitability or scale of operations leads to deterioration inthe financial risk profile.

BLPL, incorporated in 2003, processes and trades in timber. Thecompany, located in Delhi, is promoted by Mr. Ashish Bansal andMr. Mangat Rai Bansal.

Status of non-cooperation with previous CRA: BLPL has notcooperated with ICRA Limited, which has suspended its rating viderelease dated July 26, 2016. The reason provided by ICRA Limitedis absence of the requisite information from the company.

BAT AND BALL: CARE Assigns 'CARE KTP B-' Tourism Rating-------------------------------------------------------The tourism rating assigned to Bat and Ball derives strength fromfavorable location with regards to accessibility as well asproximity to tourist destinations in and around Coorg,infrastructure facilities with adequate safety and securityfeatures and compliance with various statutory requirements.

Karnataka Tourism Product - Homestay CARE KTP B- Assigned

The rating is however constrained by limited track record ofoperations, seasonality risk associated with the industry andcompetition from established homestays in the vicinity. Goingforward, improvement in quality of services offered would be thekey rating sensitivity.

Bat and Ball (BAB) was established in 2016 by Mr. A E VenuUthappa. BAB is located at Rove Estate, Nacor Gram, Suntikoppa,Kodagu District; Karnataka. The homestay is located within anestate spread across more than 70 acres, comprising of coffee andpepper plantations. The promoters reside in their bungalow, rightopposite to BAB. The home stay has four semi-furnished rooms withattached bathrooms fitted with western commode & 24*7 cold/hotwater supply, TV, Air-Conditioners, telephone with intercomfacility, wardrobes and Wi-Fi. BAB also has a common dining areaand fully equipped kitchen with water purifier, refrigerator,microwave and utensils.

BLUEZONE VITRIFIED: CRISIL Ups Rating on INR31.7MM Loan to B+-------------------------------------------------------------CRISIL has upgraded its rating on the long-term bank facilitiesof Bluezone Vitrified Private Limited to 'CRISIL B+/Stable' from'CRISIL B/Stable' while reaffirming its short term rating at'CRISIL A4'.

The upgrade reflects the quick stabilization of BVPL's operationswithin a short span of time and moderate operating margins. Thecompany is estimated to report revenues of INR70 crores andoperating margins of 12.0 per cent in fiscal 2017, its first yearof operations, post commencement of operations in March 2016.Furthermore, financial risk profile is expected to remain averagemarked by high gearing of 2.5 times and moderate debt protectionmetric with interest coverage of 1.69 times and net cash accrualsto total debt of 0.06 times for fiscal 2017. Sufficient net cashaccrual of around INR2.65 crore and INR4.06 crore in FY17 andFY18 against debt obligations of around INR1.5 crore and INR3.6crore, respectively, are expected to support working capitalrequirement along with moderate bank limit utilisation.

The ratings continue to reflect the working capital intensiveoperations and average financial risk profile. These ratingweaknesses are partially offset by quick stabilization inoperations driven by extensive experience of the company'spromoters in the ceramic industry and strategic location of itsplant at Morbi, Gujarat which ensures availability of rawmaterials and labour.

Key Rating Drivers & Detailed DescriptionWeaknesses* Working-capital-intensive operations: Working capitalrequirement will be sizeable, with gross current assets of 90-100days, mainly because of large receivables and inventory.Inventory is expected at 40-50 days, in line with industrypractice. Credit from suppliers should, however, help ease someof the pressure on working capital.

* Average financial risk profile: Financial risk profile mayremain average, with high gearing of 2.5 times as on March 31,2016. Debt protection metrics should be moderate, with interestcoverage of 1.69 times and net cash accruals to total debt of0.06 time in fiscal 2017.

Strengths* Extensive experience of promoters in the ceramic industry:Benefits from the promoters' experience of around a decade, andhealthy relationships with dealers should continue to supportbusiness risk profile. Prior to setting up LGL, the promoterswere in the vitrified and wall tiles industry through associateentities.

* Strategic location ensuring availability of raw materials andlabour: The manufacturing facilities are in Morbi, which accountsfor 65-70% of India's ceramic tile production. Benefits ofpresence in Morbi include easy access to clay (main raw material)and to contractors and skilled labourers. Other criticalinfrastructure such as gas and power are also readily available.Transportation cost is low, because of proximity to the majorports of Kandla and Mundra.Outlook: Stable

CRISIL believes BVPL will continue to benefit over the mediumterm from the promoters' extensive experience. The outlook may berevised to 'Positive' if revenue, profitability and cash accrualimprove substantially, while working capital requirementscontinue to be managed efficiently. Conversely, the outlook maybe revised to 'Negative' if low revenue, operating profitability,or cash accrual in the initial phase of operations result inpressure on financial risk profile and liquidity.

Incorporated in May 2014, BVPL is a Morbi-based companymanufacturing vitrified tiles. Commercial operations started inMarch 2016.

The ratings, however, are supported by CCIPL's stable EBITDAmargins of 4.20% in FY16 (FY15: 4.39%) and comfortable liquidityprofile as reflected by around 70% average utilization of itsfund-based limits for the 12 months ended December 2016. Theratings are further supported by CCIPL's established track recordof more than two decades in trading of cable wires, switch gears,etc., and established relationship with its majority of itscustomers thereby resulting in comfortable payment terms for thecompany.

Positive: Significant improvement in topline and/ordiversification of business leading to a significant improvementin the topline while improving current credit profile could bepositive for the ratings.

COMPANY PROFILE

CCIPL was incorporated in 1981 and is engaged in trading of cablewires, switch gears, etc. The entity is promoted by Mr. RandeepSingh Dhingra and has its registered office at Chandni Chowk, NewDelhi.

The firm supplies the readymade garments within India and haslong standing relationship with some of the established andrenowned brands such as Addidas, Reliance, Aditya Birla, Asicsand Rebook.

E VAIDYA: CARE Assigns 'B' Rating to INR7.25cr LT Bank Loan-----------------------------------------------------------The ratings assigned to the bank facilities of E Vaidya PrivateLimited are constrained by its small scale of operations with netlosses incurred during the review period, the ongoing projectalong with operations stabilization risk, high competition andfragment nature of the healthcare industry.

The ratings, however, derive strength from experience of thepromoters in healthcare industry, financial and operationalsupport from state governments of Andhra Pradesh and Telanganaand innovative approach to healthcare services.

EVPL has small scale of operations with total operating income atINR2.24 crore in FY16 (refers to the period April 1 to March 31)compared with INR0.59 crore in FY15 also the company incurredlosses in the initial years of operations on account of higheremployee cost. EVPL has a project to set up 193 primary healthcare centres in the States of Andhra Pradesh and Telangana. 31centres are set-up in Andhra Pradesh and Telangana funded throughpromoter's equity and unsecured loans. The company has to set upanother 162 centers for which the loans are yet to be tied upfrom the bank.

EVPL faces competition from both established as well as privateclinics operating in an industry. The healthcare industry isdominated by solo practice clinics and small nursing homes mostlyrun by entrepreneur doctors forming large majority of privatehospitals, whereas large corporate hospitals account for theremaining.

The promoters are well-experienced entrepreneurs and areresourceful. The promoters are infusing equity share capitalyear-on-year to manage business operations.

The Governments of Andhra Pradesh and Telangana pay INR412,000per centre for setting up the healthcare units and providing thesupply of medicines for the units.

The company proposes to set up its centres with digital clinicand Dail Ur Doctor (DUD) facilities in the State of Telanganaand Andhra Pradesh.

The Government of Andhra Pradesh passed an ordinance to implementthese products in 193 primary health centers across the state. Aspilot project, it allocated Urban Primary Health center atVishakhapatnam and Vijayawada to EVPL out of which 31 areimplemented and being run from December, 2016.

At present, EVPL has established a total of 31 healthcare centersout of which 29 are in Andhra Pradesh and 2 in Telangana. Theunits are set-up on property taken on lease and each unit has 12doctors and pharmacists. The medicines for the units are suppliedby the state governments and medical equipment is purchased byEVPL from the local stores in Hyderabad. EVPL is also providingon-line consultancy through their website by introducing packagesystem where patients will be required to purchase packages for 1month, 3 month, 6 months or 1 year.

The total cost of the project is estimated at INR8.10 crore. Thepromoter's contribution would be 32.10% of the project cost ie,around INR2.60 crore and the balance through term loan of INR5.50crore.

EVPL is planning to extend its healthcare services and reach outto the governments of Rajasthan and Chhattisgarh forsetting up healthcare units in that states.

The upgrade reflects CRISIL's expectation of continuedimprovement in the business risk profile of EMPL, with improveddemand likely to aid sustained growth in revenue of around 10%and expected operating margins of over 1.8% for fiscal 2017.Operating income stood at INR143 crore in fiscal 2016. Return oncapital employed (ROCE) is also expected to improve further tomore than 10% in fiscal 2017, as a consequence of improvedprofitability and efficient working capital management. Liquidityis also expected to remain adequate with expected net cashaccruals of over INR 90 lakhs against minimal term debtobligation in fiscal 2017.

Key Rating Drivers & Detailed DescriptionStrengths* Established market position of the principal, and sustainedgrowth in revenue: EMPL has reported a healthy ramp-up in sales,on the back of Hyundai's established brand presence, mainly inthe small car segment, and the newly-launched models. Newvariants along of CRETA, launched in July 2015, have witnessedhealthy demand. Also, the expected launch of variants of grandi10, Accent, and i20 in the first or second quarter of calendaryear 2017, should support demand further.

* Funding support from promoters: Promoters have supportedliquidity by infusing equity of INR2.82 crore and INR2.9 crore infiscals 2016 and 2015, respectively.

Weaknesses* Modest operating margin: Profitability remains muted, withoperating margin of 1.3% in fiscal 2016 due to the high rentaloutgo, towards the showrooms. The margin is however, expected toimprove to over 1.8% in fiscal 2017 backed by increase in salesvolume and increase in sales of higher margins cars.

* High total outside liabilities to adjusted networth (TOL/ANW)ratio: The TOL/ANW ratio was high at 5.12 times as on March 31,2016, owing to a small networth and high working capital debt.The nature of business is such that capex requirement is low andbulk of debt is short-term. However, the TOL/ANW ratio isexpected to improve gradually over the medium term.Outlook: Stable

CRISIL believes EMPL will benefit from the expected healthy salesgrowth and funding support from the promoters, over the mediumterm. The outlook may be revised to 'Positive' if growth inrevenue and profitability strengthens the financial risk profilesignificantly. The outlook may be revised to 'Negative' if lower-than-expected sales and profitability, or a stretch in theworking capital cycle, weakens the financial risk profile.

EMPL was incorporated in 2014 by the promoter, Mr. Ankit Yadav.The company is an authorised dealer of passenger carsmanufactured by Hyundai Motors India Ltd. Operations commencedfrom November 2014, from a showroom in Defence Colony, and aservice centre in Okhla (both in New Delhi).

* The ratings are provisional and shall be confirmed upon thesanction and execution of loan documents for the proposedfacilities by GMT to the satisfaction of Ind-Ra.

KEY RATING DRIVERS

The ratings are constrained by a high debt burden, indicated by adebt/current balance before interest and depreciation (CBBID) of2.69x in FY16. Ind-Ra expects GMT's debt/CBBID to increase inFY17 and FY18, driven by ongoing capex. GMT expects a capex ofINR419 million (funded via debt and internal accruals) over FY17-FY20.

The ratings are further constrained by GMT's weak liquidityposition. In FY16, its available funds-to-operating expenditurewas 11.68% (FY15: -0.01%) and available funds-to-financialobligations was 8.03% (-0.01%).

The ratings reflect GMT's moderate credit profile in FY16,despite an improvement in profitability. Its top line increasedat a 45.04% CAGR to INR175.76 million over FY12-FY16. However,it declined to INR175.76 million in FY16 from INR184.49 millionin FY15. Its operating margin was 35.93% in FY16 (FY15: 21.15%)despite regulated tuition fees (FY16: up 10.25% yoy; FY15: up4.66% yoy) and high operating costs.

However, the ratings are supported by GMT's student strength,which increased at a CAGR of 22.05% to 2,371 over FY12-FY16.Moreover, the trust has industry affiliation in the form of tie-ups with various companies, which have sponsored researchlaboratories established by it.

RATING SENSITIVITIES

Negative: Any unexpected fall in student demand, along with ahigher-than-expected rise in debt-led capex, resulting instrained liquidity position, could trigger a negative ratingaction.

Positive: A sustained rise in student enrolments leading tohigher income resulting in an improved liquidity position couldtrigger a positive rating action.

COMPANY PROFILE

GMT was founded by Chairman Mr. Abhishek Yadav and his brotherMr. Mohit Yadav (secretary) in May 2008. It is incorporatedunder the Indian Trust Act, 1882. In 2009-10, the trust set upGMT Group of Institutions (GGI) at Chandrika Devi Road, Bakshi KaTalab, Lucknow.

GMT operates seven institutes on the GGI campus, offeringundergraduate and postgraduate courses in engineering, managementand teaching, along with diplomas and polytechnic courses.Moreover, it runs a hospital (GCRG Memorial Hospital), whichcommenced operations in 2014-15, and a medical college, whichcame online in 2016-17, on the campus.

The ratings are further constrained by working capital intensivenature of operations, raw material price fluctuation risk,cyclicality associated with the steel industry and intensecompetition in the industry due to low entry barriers.

The rating however draws comfort from the experienced managementalong with long track record of operations of the entity.

Going forward, the ability to profitably scale up its operationswith improvement in the capital structure along with efficientmanagement of its working capital requirements shall be the keyrating sensitivities.

Detailed description of the key rating drivers

The company has long track record of operations with all thedirectors having relevant experience of more than 15 yearswhich has resulted in long term relationship with customers andsuppliers. The total operating income of the company stood smallwhich inherently limits the company's flexibility in times ofstress and deprives it of scale benefits. Also, profitabilitymargins of the company stood low owing to limited value additiongiven highly competitive industry. The capital structure stoodhighly leveraged mainly on account of net losses in the pastwhich resulted in erosion of net worth base. Furthermore, HSPLhas weak debt coverage indicators on account of high debt levelsand low GCA against profitability. High working capitalrequirements of the company were met largely through bankborrowings which remained fully utilized during the past 12 monthperiod ending September, 2016 The company is exposed to rawmaterial price volatility due to volatility experienced in theprices of steel. Furthermore, steel is a cyclical industry whichhas strong correlations with economic cycles. This emerges fromthe fact that its key users like construction, etc. are highlydependent on the health of the economy. Thus, HSPL being asmaller player in the industry gets affected during cyclicaldownturns of the industry. Moreover, HSPL operates in a highlyfragmented industry with competition from both organized andunorganized players established in vicinity of the company.

Uttar Pradesh-based Harso Steels Private Limited was incorporatedin 1986 and started its commercial operation in 1993. The companyis currently being managed by Mr. Rakesh Kumar Bansal, Mr. VikasBansal and Mr. Adesh Tyagi. HSPL is engaged in manufacturing ofsteel tubes, PVC pipes, steel structure and bottom lid. HSPL hasan installed capacity to manufacture 50,000 tons of steel tubesper annum as on March 31, 2016 and the manufacturing unit islocated at Sahibabad (Ghaziabad), Uttar Pradesh. The main rawmaterial is steel which the company procures mainly from SteelAuthority of India Limited. HSPL sells its products domesticallyto wholesalers and construction companies. Rama Steel TubesLimited is group associate and engaged in manufacturing andexporting of steel products.

For FY16 (refers to the period April 1 to March 31), HSPLachieved a total operating income (TOI) of INR50.75 crore withprofit after tax (PAT) of and INR0.17 crore, respectively, asagainst TOI of INR50.95 crore with losses of INR(8.65) crore, inFY15. Furthermore, the company has achieved total TOI of INR40.00crore till 7MFY17 (refers to the period April 1 to October 31,based on provisional results).

However, the ratings are supported by HSPL's moderate scale ofoperations. In FY16, revenue increased to INR275.46 million(FY15: INR78.33 million) as the company became a redistributionstockist of Apple and Vivo products. The ratings also factor inthe company's established track record with almost a decade-longexperience in the distributorship of electronic goods, and anestablished relationship with the majority of its customers,thereby resulting in comfortable payment terms for HSPL.

RATING SENSITIVITIES

Negative: A sustained decline in the credit metrics will benegative for the ratings.

Positive: An improvement in the top line and profitability,resulting in an improvement in the credit profile will bepositive for the ratings.

COMPANY PROFILE

Incorporated in 2007, HSPL is a registered distributor of Titanwatches, Vivo mobiles, and Apple products and its accessories.The company is promoted by Mr. Kuldeep Agrawal and has itsregistered office in Faridabad, Haryana.

The ratings are constrained by elongated operating cycle of 275days during FY16 (FY15: 396 days) and tight liquidity asreflected in 93.04% average utilization of the fund-based bankfacilities during the six months ended January 2017.

The ratings, however, are supported by ICL's long track record ofoperations of more than five decades, experienced management,reputed client base and revenue visibility for the next year onaccount of healthy order book position of around INR1,500 millionas on Jan. 31, 2017.

Positive: A significant improvement in revenue along withimprovement its credit profile will be positive for the ratings.

COMPANY PROFILE

ICL was incorporated in 1965 as Universal Refrigeration Limited.Over the years, the company has been consistently upgrading itstechnology and products and similarly changing its name. In2004, the company was renamed International Coil Limited. Thecompany has four business divisions, namely, air conditioning(district energy, cooling/heating), refrigeration (cold storagesand freezing plants), heat transfer (air cooled cooling systems)and EPC Projects (engineering project contracts). The companyhas its registered office in New Delhi.

JAIPRAKASH POWER: JSW Energy Buyout Stuck as Lenders Invoke SDR---------------------------------------------------------------LiveMint reports that JSW Energy Ltd's plan to buy the 500 mega-watt (MW) Bina thermal power plant from Jaiprakash Power VenturesLtd may come unstuck as the latter's lenders have invokedstrategic debt restructuring (SDR), according to two peoplefamiliar with the discussions.

LiveMint relates that the deal, which has been under discussionsince 2015 has made slow progress, the people said, requestinganonymity.

"The deal is unlikely to happen now due to SDR in JaiprakashPower," one of the two cited above said. The power producer,which is part of the debt-laden Jaypee Group, had said in Julythat its lenders have recommended SDR - the second group companyafter Jaiprakash Associates Ltd, where lenders recommendedinvoking SDR.

Under the SDR mechanism, banks can convert a part of the debt ina company to majority equity, taking over operational control,LiveMint notes.

According to LiveMint, Jaiprakash Power Ventures on Feb. 18alloted 305.8 crore equity shares to its lenders as part of debtrestructuring scheme, which would reduce the debt of INR3,058crore.

Both JSW Energy and Jaiprakash Power Ventures did not respond toemailed queries and subsequent requests for comments sinceFebruary 14, LiveMint notes.

LiveMint, citing agreement between the two companies, says thedeadline of the Bina plant's acquisition is set for May 31, 2017at an enterprise value of INR2,700 crore.

Jaypee Group has over the past two years been pushed by lendersto sell assets, transfer ownership of land parcels and even handover the keys to the group's headquarters in Noida to pare debt,adds LiveMint.

JPVL, a 60.69% subsidiary of Jaiprakash Associates Ltd, isengaged in power generation business and currently has oneoperational hydro power project of 400 MW (Vishnuprayag inUttarakhand), and two thermal power projects of having 1,820 MWcapacity (500 MW Bina and 1,320 MW Nigrie, Madhya Pradesh). JPVLhas a presence in the power transmission business through its 74%subsidiary Jaypee Powergrid Ltd, which has set up a 214-kmtransmission line. The company, through its subsidiary PrayagrajPower Generation Ltd, has 1,980-MW thermal power project in Bara,Uttar Pradesh, of which 660-MW capacity is operational and restis under implementation. JPVL has also commissioned 2 MTPA cementgrinding unit at Nigrie in June 2015.

The revision in the ratings of the bank facilities of JaiprakashPower Ventures Ltd (JPVL) factors in delays in debt servicing bythe company due to its weak liquidity.

KBK CHEM: CARE Assigns B- Rating to INR15cr LT Bank Loan--------------------------------------------------------The ratings assigned to the bank facilities of KBK ChemEngineering Private Limited is constrained by its weak financialprofile characterised by modest scale of operations, net lossesincurred in the past three years leading to adverse net-worth,highly leveraged capital structure and weak debt protectionmetrics. The ratings are further constrained by its workingcapital intensive nature of operations and presence in the highlycompetitive and fragmented industry.

The above constraints are partially offset by the experience andresourcefulness of the promoters as well as the financialsupport demonstrated by the parent company.

Ability of the company to improve its financial profile byincreasing its scale of operations and improve profitability andcapital structure along with efficient management of workingcapital requirement is the key rating sensitivity.

Outlook: StableDetailed description of the key rating drivers

KCEPL is engaged into manufacturing of boilers used indistilleries, breweries, sugar, chemical processing andcogeneration plants. Its sales are primarily order backed and dueto long shelf life of products manufactured and intensecompetition faced, the company's operations are low andfluctuating leading to limited financial flexibility. Subsequentto low scale of operations and high fixed costs borne, companyincurred net losses in the past three years leading to erosionof its net-worth base. Furthermore, to support high workingcapital intensity involved with operations reflected by highgross current asset days its working capital limit utilizationremained high leading to weak capital structure and debtprotection metrics.

Nonetheless, KCEPL benefits from the resourcefulness of itspromoters and the financial support of the parent companyShree Renuka Sugars Limited which has given unsecured loans tosupport KCEPL's operations.

Incorporated in the year 1997 by Mr. Vijendar Singh, KBK ChemEngineering Private Limited is engaged into manufacturing ofMachineries and EPC solutions for distilleries, bio-ethanol,brewery, at its facility in Pune, Maharashtra which is spreadover 4000 sq. ft. and has an ASME Boiler and Pressure Vessel Codecompliant fabrication capability of 1320 ton per annum andmanufacturers specialized machinery based on its customers'requirements.

KCEPL is a 100% subsidiary of Shree Renuka Sugars Limited (SRSL)which is one of the largest private sector sugar manufacturers inIndia with a total crushing capacity of 101520 TCD operating 7units in India and 4 units in Brazil.

During FY16 (refers to the period April 01 to March 31), KCEPLachieved total operating income (TOI) of INR35.46 crore (vis-a-vis INR40.10 crore during FY15) coupled with net loss of INR16.37crore (vis-a-vis net loss of INR7.29 crore during FY15).

* Susceptibility to volatility in raw material pricesThe costs of raw materials such as mild steel (MS) ingots andbillets exceed 90% of KSI's net sales. Consequently,profitability is expected to remain highly susceptible to anyadverse changes in raw material prices as the ability to pass oninput price hikes to clients is restrained by high competition.

* Weak financial profileFinancial profile is weak marked by modest networth, high gearingand average debt protection measures. Networth and gearing was atINR2.7 crore and 4.4 times as on March 31, 2016. The interestcoverage and net cash accrual to total debt ratios were at 1.7times and 0.08 time.

Strength* Extensive experience of proprietorThe partners have around three decades of experience in theindustry through group companies and has developed healthyrelationships with dealers and distributors.Outlook: Stable

CRISIL believes KSI will continue to benefit from the industryexperience of its partners. The outlook may be revised to'Positive' if improvement in profitability leads to a substantialincrease in cash accrual and hence strengthens financial riskprofile. The outlook may be revised to 'Negative' if operatingmargin is low or if increase in working capital requirementweakens financial risk profile.

Set up in 2001, KSI is promoted by Mr. Shayamlal Gupta. The firmmanufactures MS products such as MS angles, MS round bars, MSflats, and MS squares.

For fiscal 2016, KSI reported a book profit of INR0.3 cr on netsales of INR87.9 cr, against INR0.1 cr and INR121.8 cr for fiscal2015.

KHUSHIYA INDUSTRIES: CARE Hikes Rating INR20.80cr LT Loan to BB-----------------------------------------------------------------The revision in the rating assigned to the bank facilities ofKhushiya Industries Private Limited was mainly on account ofsignificant increase in TOI and profitability and improvement indebt coverage indicators during FY16 (refers to the periodApril 1 to March 31). The rating continues to derive comfort fromthe experience of the promoters in the industry.

The rating continues to remain constrained on account of thinprofit margins, leveraged capital structure, weak debt coverageindicators and working capital-intensive nature of operations.The ratings are further constrained due to KIPL's presence in thehighly fragmented edible oil industry, susceptibility of itsprofit margins to fluctuations in raw material prices along withdependence on agro-climate conditions and seasonality associatedwith availability of raw material.

The ability of KIPL to increase its scale of operations alongwith improvement in profit margins, capital structure, debtprotection metrics and efficient working capital managementremains the key rating sensitivities.

Detailed description of the key rating drivers

KIPL's total operating income (TOI) witnessed a y-o-y increase ofabout 126.56% on account of increase in sales volume of prices offinished goods as well as increase in its customer base. BothPBILDT and PAT increased significantly by more than 64% and 651%respectively. But PBILDT margin declined by 158 bps and remainedmoderate during FY16. However, KIPL reported profit in FY16compared to loss in FY15. KIPL's overall gearing stood high as onMarch 31, 2016 on the back of new term loan availed during FY16for its solvent extraction project coupled with increase inworking capital bank borrowing which led to increase in totaldebt level as on March 31, 2016. Debt coverage indicators markedby total debt to GCA though improved stood weak as on March 31,2016. Overall operations remained working capital intensivemarked by high average working capital utilization of 90% duringthe 12 months ended December 2016 and long operating cycle inFY16.

Mr Mehul Thakkar possess an experience of more than a decade intrading of oil through Tirupati Agro Products (Proprietorshipfirm). Mr. Dalpatram Thakkar, also possess an experience of morethan a decade in trading of oil products through Krushi AgroProprietorship firm). Ms Rita Thakkar, also possess an experienceof around 5 years in trading of oil products. Over the years, thepromoters have established good relationship with customers andsuppliers.

Banaskantha-based (Gujarat), KIPL was incorporated in 2012 by Mr.Mehul Thakkar, Mr. Dalpatram Thakkar and Ms Ritaben Thakkar. KIPLis engaged in the business of extraction of mustard oil andcastor oil. It was engaged in the business of trading of mustardoil up to March 31, 2014. It stopped trading from FY14 andcommenced manufacturing of mustard oil from April 1, 2014 withcompletion of setting up an expeller plant at total capital costof INR6 crore. It also started manufacturing of castor oil fromJune 2016 onwards. It operates from its manufacturing facilitieslocated at Banaskantha with an annual installed capacity of30,000 Metric Tons Per Annum (MTPA) as on March 31, 2016.Finished goods of KIPLare sold to refineries for further processing to make it ediblewhile their by-products (i.e. oil cake) are sold to theindustrial units for solvent extraction. The by-product (i.e. oilcake) can also be used as animal feed.

KIPL entered into forward integration in the value chain bysetting up solvent extraction plant with total installed capacityof 90,000 MTPA in February 2016. The total cost of the projectwas INR8.59 crore which was funded through project debt equity of7.18 times. KIPL commenced commercial production of solvent plantfrom February 2016.

During FY16 (A), KIPL reported PAT of INR0.35 crore on a TOI ofINR80.95 crore as against net loss of INR0.06 crore on a TOIof INR35.73 crore during FY15. During 9MFY17 (Provisional), KIPLhas achieved a turnover of INR118.80 crore.

The ratings are constrained by KPPL's presence in a highlyfragmented and intensely competitive industry.

The company has a tight liquidity position as reflected in 99.0%average utilization of the working capital facility for 12 monthsended December 2016.

The ratings are, however, supported by KPPL's promoters'experience of over two decades in the edible oil manufacturingand trading business.

RATING SENSITIVITIES

Positive: A substantial improvement in operating margin alongwith improvement in credit metrics could be positive for rating.

Negative: Further deterioration in operating margin and creditmetrics could be negative for ratings.

COMPANY PROFILE

KPPL was incorporated in January 2005 as a private limitedcompany by the Palanpur-based Kisan Group. The company has itsregistered office at Palanpur in Ahmedabad. The company isprimarily engaged in solvent extraction from the rapeseed andmustard seed.

The downgrade reflects irregularity in paying instalments on termloan and interest on cash credit facility due to stretchedliquidity.

The rating continues to reflect its working capital-intensive andmodest scale of operations in a highly fragmented and intenselycompetitive rice milling business, volatility in raw materialprices, regulatory changes, and erratic rainfall. These ratingweaknesses are partially offset by the extensive experience ofthe promoters in the rice milling segment and stable demand forrice.

Key Rating Drivers & Detailed DescriptionWeakness* Delays in servicing instalment on term loanLow cash accrual and sizeable working capital debt led to weakliquidity, which in turn resulted in delays in servicinginstalment on term loan and in meeting interest obligation oncash credit facility.

Strength* Experience of promoters in the rice industry: Presence ofalmost three decades in trading in basmati and non-basmati riceand various fast-moving consumer goods has enabled the promoterto establish healthy relationship with customers and suppliers.

The company has reported profit after tax of INR0.24 crore on netsales of INR12.59 crore in 2015-16.

MANDAKINI TRAVEL: CARE Revises Rating on INR4.62cr Loan to 'B'--------------------------------------------------------------The revision in the ratings of Mandakini Travel & Tours PrivateLimited factors in the growth in the scale of operations,improvement in profitability margins and coverage indicators. Theratings continue to draw comfort from the experienced promotersand location advantage.

The ratings, however, continue to remain constrained on accountof small scale of operations, leveraged capital structure alongwith competition from other existing hotels and subdued industryoutlook of hospitality industry.

Going forward, the ability of MTTP to increase its scale ofoperations by achieving higher occupancy levels and high averageroom rent shall be the key rating sensitivities. Furthermore,continued support from the promoter would also be a key ratingsensitivity.

Detailed description of the key rating drivers

The company has considerable track record of operations in hotelbusiness. Moreover, the company is being managed by experiencedmanagement having wide experience in hospitality business.

During FY16 (refers to the period April 1 to March 31), thecompany registered growth in the total operating income ofaround 60% over previous financial year coupled with improvementregistered in profitability margins. The improvement inprofitability margin was attributed to higher other income (spaand others) coupled with improvement in average occupancy rate.The improvement in profitability margin led to improvement incoverage indicators. However, owing to negative net worth onaccount of erosion of net worth in the past, the capitalstructure continued to remain leveraged.

The Indian hotel industry is highly fragmented with a largenumber of budget hotels and luxury hotels which providecompetition to MTTP. However, the location advantage of the hotelpartially mitigates the risk to an extent because the demand forhotel rooms in Rishikesh and other nearby areas (such asHaridwar) is expected to steadily grow on account of increase inthe commercial activity in these areas.

New Delhi-based MTTP was incorporated in 1987 as Mandakini Travel& Tours Private Limited by Mr. Suraj Gulati, Mr. Vijay Gulati andMr. Sunil Gulati. The company is presently operating hotel underthe name "Hotel Ganga View" in Rishikesh (Uttrakhand). The hotelwas first commissioned in 1987 and subsequently in 2012, thehotel was renovated wherein, it has been upgraded to four starsas per classification and guidelines issued by the Ministry ofTourism. The hotel consists of 32 rooms, restaurants, banquethall (150 person capacities) and other facilities which includemodern spa technology, ayurvedic therapies like Abhyanga,Shirodhara, Sarwangadhara, etc. The group company of MTTPincludes Ellbee Associates Private Limited running a hotel namelyHotel Ashok Continental (Mussoorie) and has three upcomingproject in Haridwar, Rishikesh and Saharanpur. Another groupconcern i.e. Ellbee Hospitality Worldwide Private Limited ispresently providing the hotel operational and management servicesto MTTP.

In FY16, MTTP achieved a total operating income (TOI) of INR3.85crore with net profit of INR0.10 crore as against TOI of Rs.2.51crore with net loss of INR1.02 crore in FY15. The company hasachieved total operating income of INR3.44 crore 9MFY16 (refersto the period April 1 to December 31) (as per the unauditedresults).

MINERVA POULTRY: CARE Reaffirms B Rating on INR4.91cr LT Loan-------------------------------------------------------------The rating for the bank facilities of Minerva Poultry Pvt. Ltd.continued to remain constrained by its small size of operations,vulnerability of profits to raw material price movements, workingcapital intensive nature of operations and presence in a highlycompetitive and fragmented nature of the industry. These factorsfar outweigh the benefits derived from the rich experience of thepromoters with long track record of operation and favourabledemand prospects for the poultry sector across India.

The ability of the company to increase its scale of operationswith improvement in profit levels and margins and effectivemanagement of the working capital would be the key ratingsensitivities.

Detailed description of the key rating drivers

Key Rating Weaknesses

Small size of operations

The total operating income increased by 16.53% in FY16 toINR18.05 crore. However, the scale of operations still remainedon the lower side. Furthermore, the total capital employed alsoremained low at INR13.00 crore as on March 31, 2016.The entity has generated a total operating income of aboutINR15.49 crore during 9MFY17.

Vulnerability of profits to raw material price movementsPoultry feeds are the major raw material for the company, whichare mostly agro-based commodities like maize, soybeanetc. and dependent on agro-climatic conditions. In view of thesame the prices are volatile and in turn have a negativebearing on the profitability.

Working capital intensive nature of operations

The business of the company is working capital intensive due toits higher inventory holding requirements in view of volatilityin the prices of the same. The operating cycle of the companyalbeit improved in FY16, still remained on the higher side due tohigher raw material holding. The average fund based workingcapital utilization remained high at about 98% during the lasttwelve month ending on January 31, 2017.

Highly fragmented and competitive poultry industry with outbreaksof bird flu Poultry eggs and meats are food articles of regularconsumption and stable demand. This feature of poultry farmbusiness attracts many unorganised players. Furthermore, theintermittent outbreak of bird flu affects the poultry industry.Such contagious disease outbreaks will have a high impact on theindustry thereby leading to crash in prices of table eggs.

Key Rating StrengthsExperienced promoters with long track record of operationMPPL commenced its operation in the year 1993, and is managed byMr. Dinesh Meher, MD (aged 45 years, B.com), having around twodecades of experience in this trade, along with his co-directorMr. Brijesh Meher (aged 37 years, MBA), looking after the financefunction in the entity.

Favourable demand prospects for the poultry sector across IndiaThe domestic poultry sector has seen strong growth in the lastthree years with the growth trend likely to continue in themedium-term on the back of favourable socio-economic anddemographic factors.

Minerva Poultry Private Limited (MPPL), incorporated in December02, 1991, was promoted by Meher family of Bolangir(Odisha). The company is engaged in the business of sale of layerbirds and eggs. MPPL started as a poultry firm inDecember 1991 and commenced commercial production in the year1993. It has its unit located at Bhadrapali, Dist-Bolangir(Odisha) with a present capacity of 3.0 lacs layer birds with perbird producing around 300 eggs (approximately) annually.

During FY16, the company reported a total operating income ofINR18.05 crore (FY15: INR15.49 crore) and net loss of INR0.04crore (in FY15: PAT of INR0.59 crore). The entity has generated atotal operating income of about INR15.49 crore during 9MFY17.

The ratings reflect P&Y's small scale of operations with revenueof INR500 million in FY16 (FY15: INR555 million). During FY16,the company changed its business operations from trading of goodssuch as iron scarps (FY16: INR114.3 million, FY15: 404.7 million)to focus on the chartering of its vessel (INR386 million,INR151 million). The company has a one-year charter contractwith Pan Global Transport LP, Dubai for a fixed charter fee ofUSD12,307.7 per day. It also has a natural foreign currencyhedge as all its receipts and operational payments are in thesame currency. Ind-Ra expects revenue to further decline in FY17due to change in the company's business operations.

However, the ratings benefit from P&Y's strong EBITDA margin,which improved to 44.8% in FY16 (FY15: 6.5%) after exiting thelow margin trading business. Ind-Ra believes the margin toremain constant over the coming years owing to fixed revenue fromthe contract. Moreover, the margins are protected from fuelprice volatility, since the fuel costs are borne by the clients.

The ratings also factor in the company's moderate credit metrics,which improved on the back of rise in the EBITDA margin.Interest coverage (operating EBITDA/gross interest expense)improved to 3.5x (FY15: 1.3x) and net leverage (adjusted netdebt/operating EBITDA) to 2x (14.1x).

The ratings are supported by the promoters' over four decades ofexperience in the same line of business.

RATING SENSITIVITIES

Positive: Renewal of the existing contract with high charteringfee leading to a strong revenue growth, while maintaining thecredit metrics will be positive for the ratings.

Negative: Failure to renew the contract on a timely basis,leading to debt servicing uncertainty will be negative for theratings.

COMPANY PROFILE

Incorporated in June 2013, P&Y was promoted by a group ofprofessionals with an experience in providing offshore charteringof ships.

The company has been set up to provide inland water transport toforeign companies. It owns one vessel (Distya Pushti), which ischartered mainly for cargo, chemical and oil tanker shipment.

The ratings continue to reflect the company's weak liquidity dueto subdued cash accrual and no cushion in working capital bankline. While the company is likely to ramp up operations over themedium term, timely fund support from promoters will be a keydriver of liquidity.

Key Rating Drivers & Detailed DescriptionWeaknesses* Nascent stage of operations:PLSPL commenced operations in April 2015 and is in nascent stageof operations. The manufacturing of generic drugs requiresapproval from various bodies, which may result in proceduraldelays.

* Weak financial risk profile:The financial risk profile is weak because of high gearing of4.63 times and modest networth of INR2 crore as on March 31,2016, and weak debt protection metrics.

Strength* Promoters' extensive industry experience:PLSPL is promoted by Mr. M R Shetty, Mr. Pramod Hegde, and theirrelatives. Mr. Shetty has experience of over 25 years in thepharmaceuticals industry. He was earlier involved in processingand manufacturing of herbal extracts on a jobwork basis.Outlook: Stable

CRISIL believes PLSPL will continue to benefit from itspromoters' extensive industry experience. The outlook may berevised to 'Positive' if the company significantly scales upoperations or operating profitability, resulting in a betterfinancial risk profile. The outlook may be revised to 'Negative'if accrual is lower than expected, or working capital requirementis larger than expected, weakening the financial risk profile.

PLSPL, set up in 2012 and based in Udupi, Karnataka, is part ofthe Prakruti group. It undertakes contract manufacturing ofpharmaceutical drugs. Operations are managed by Mr. M R Shetty.

In fiscal 2016, its profit after tax (PAT) was INR-5.47 crore onnet sales of INR3.94 crore.

S S M FOUNDATION: CRISIL Assigns 'D' Rating to INR4.4MM LT Loan---------------------------------------------------------------CRISIL has revoked the suspension of its rating on the long-termbank facilities of S S M Foundation Trust For Educational andSocial Development and has assigned its 'CRISIL D' rating to thefacilities. CRISIL had suspended the rating on October 14, 2016,as SSM had not provided the requisite information required for arating review. The trust has now shared the requisiteinformation, enabling CRISIL to assign a rating to its bankfacilities.

The rating reflects instance of delay by SSM in servicing itsterm debt because of weak liquidity. These weaknesses are partlyoffset by extensive experience of its promoters in the educationindustry.

Key Rating Drivers & Detailed DescriptionWeaknesses* Delay in debt servicing:SSM has been delaying in servicing its debt to the extent of 10to 20 days owing to weak liquidity. Trust's liquidity remainedconstrained due to cash flow mismatch during lean fee collectionperiod and delay in realizing payment from government towardsscholarship which accounts for about 40% of its total fee.

* Weak liquidity: The trust's liquidity is constrained by cashflow mismatch and delays in payments from government departments,which account for 40% of its income.

Strength* Extensive industry experience of the promoters:SSM's business risk profile is supported by its promoters'experience of three decades in the education industry.

SSM, set up in 1998, operates SSM College of Engineering, whichoffers engineering under-graduation and post-graduation courses,at Komarapalayam in Tamil Nadu. The trust is recognised by theAll India Council for Technical Education and is affiliated toAnna University, Tamil Nadu.

The ratings continue to reflect exposure to implementation andhydrology risks related to an ongoing project. These weaknessesare partially offset by a long-term fixed-price power purchaseagreement (PPA).

Key Rating Drivers & Detailed DescriptionWeaknesses* Exposure to implementation risks associated with the ongoingproject:The company is setting up a 3.5-megawatt (MW) hydropowergeneration power project at an estimated cost of around INR27.6crore, which is planned to be funded through a term loan ofINR15.00 crore and the remaining through promoter funds. Thepromoters have brought in INR4.63 crore in the form of equity asof March 31, 2016. The project will be exposed to implementationrisk until it is commissioned.

* Exposure to hydrology risk inherent in hydropower projects:Power generation in such projects depends on the availability ofadequate water flow through the barrage. Snow and rain are themain sources of water, which depend on annual rainfall in theregion. Hence, the company is exposed to hydrology risk. Thepossibility of geology-related risks cannot be ruled out in thearea, which may impose severe obstructions in the functioning ofthe project tunnel and powerhouse. The company is likely toremain exposed to hydrology and geology risks in its project.

Strength* Long-term, fixed-price:The company has entered into a PPA with Himachal Pradesh StateElectricity Board for 40 years at the rate of INR3.08 per unit.This mitigates demand and price risk.Outlook: Stable

CRISIL believes SERPL will implement its ongoing project withoutany significant time or cost overrun. The outlook may be revisedto 'Positive' if the project is completed within the scheduledtimeline, and generates higher-than-expected cash because of anincrease in the plant load factor or revenue realisation. Theoutlook may be revised to 'Negative' if there is any delay inplant commissioning, or significant delays or defaults by thepower purchaser.

SERPL is setting up a 3.5-MW hydro power generation project,which is expected to be commissioned in fiscal 2018. It hasentered into a 40-year PPA with Himachal Pradesh StateElectricity Board at INR3.08 per unit.

The ratings are further constrained by its presence in a highlycompetitive and fragmented industry, proprietorship nature ofconstitution and susceptibility of its profitability to foreignexchange fluctuations.

The above weaknesses are partially offset by the vast experienceof the proprietor in the packaging products industrycoupled with moderate profit margins.

Ability of the entity to increase its scale of operations whilemaintaining its profitability amidst intense competition andimproved capital structure and efficient management of itsworking capital requirement is the key rating sensitivity.

Detailed description of the key rating drivers

SC is engaged into manufacturing of packaging products which is ahighly competitive and fragmented industry comprising of lowentry barriers leading to presence of large number of organisedand unorganised players. Over nearly half a decade of operations,its scale of operations has remained small limiting the financialflexibility of the entity.

Furthermore, due to the entity's low net-worth and high relianceon working capital bank borrowings, its capital structureremained leveraged and consequently debt protection metricsremained weak. However, the profitability margins remainedmoderate in the range of 8%-12% during last three years endingFY16.

SC's operations are working capital intensive in nature withfunds being blocked in inventory as the company procuresraw materials in bulk to obtain cash discounts leading to highreliance on working capital bank borrowings. Furthermore,due to 50% sales being exported and a lack of natural hedge andonly partial active hedging practices adopted, SC'sprofitability is exposed to foreign exchange fluctuation.Moreover, due to its constitution being proprietorship in nature,the entity is exposed to risk of dissolution of the entity due topoor succession planning and has limited access to the raisecapital.

Established in the year 2009 by Mr. Shishir Sagunlal Jalundhwala,Silvershine Corporation (SC) is a proprietorship concern engagedinto manufacturing of Paper plates, lids, boxes and cups. Itoperates two manufacturing facilities, one at Vada, Palghar(which is spread over 4500 sq. ft.) and second at Talasari,Palghar (spread over 2000 sq. ft.) and exports around 50% of itsproducts to its clients in the USA and remaining to domesticcustomers.

During FY16 (refers to the period April 1 to March 31), SCachieved total operating income (TOI) of INR9.14 crore (vis-a-visINR8.57 crore in FY15) along with net profit of INR0.24 crore(vis-a-vis INR0.24 crore in FY15).

SPECIFIC ALLOYS: CARE Assigns B+ Rating to INR7.50cr LT Loan------------------------------------------------------------The ratings assigned to the bank facilities of Specific AlloysPrivate Limited are constrained by the modest scale ofoperations with low capitalization, customer concentration riskand susceptibility of the profit margins to volatility in rawmaterial prices. The ratings are further constrained on accountof fluctuating total operating income and profitability,leveraged capital structure and weak debt coverage indicators andworking capital intensive nature of business.

The ratings however, are underpinned by the extensive experienceof the promoter along with an established track record of thecompany and reputed customers and suppliers base.

The ability of the company to improve its scale of operations,profit margins and capital structure while managing its workingcapital requirement efficiently is the key rating sensitivity.

Detailed description of the key rating drivers

The total operating income (TOI) of the company has been slightlyfluctuating in the last three years on account of the weak demandin the industry. However, the scale of operations remains smallwith low net-worth base thus limiting its financial flexibility.Furthermore, the company was consistently able to maintain thePBILDT margin in a close range of 6%-7% in the last threefinancial years ended FY16 (refers to the period April 1 to March31) despite fluctuation owing to volatility in input prices.However, the capital structure remained leveraged as indicated byan overall gearing in the range of 4.62x as on March 31, 2016.Furthermore, the operations of the company are highly workingcapital intensive in nature leading to high utilization ofworking capital limits owing to high amount of money stuck indebtors and inventory and low credit period received from itssuppliers. Furthermore, the company has a low bargaining powerwith its reputed customer and supplier base.

The company is promoted by Mr. Narendra Surana along with hissons Mr. Jinendra Surana and Mr. Lakendra Surana. The keypromoter of the company has more than three decades of experiencein the manufacturing of alloys, through various group entities.

Incorporated in 2002, Specific Alloys Private Limited is engagedin the manufacturing of aluminium alloys, aluminium cylinderhead, aluminium alloys ingot, industrial alloy aluminium ingot,aluminium ingots, aluminium alloys powder amongst others. SAPLhas its manufacturing facility located at Khed, Pune,Maharashtra, with an installed capacity to manufacture 6600 MTPA.The facility of the company is ISO 9008:2008 certified. The majorraw materialrequired for the process is aluminium scrap which the companyprocures from indigenous as well as foreign sources.

During FY16, the company reported a total operating income ofINR67.51 crore (as against INR61.77 crore in FY15) and profitafter tax of INR0.58 crore (as against INR0.55 crore in FY15).

Status of non-cooperation with previous CRA: CRISIL has suspendedits rating vide press release dated November 09, 2015 on accountof non-cooperation by SAPL with CRISIL's efforts to undertake areview of the outstanding ratings.

Key Rating Drivers & Detailed DescriptionWeaknesses* Improving-yet-modest scale of operations and low operatingmargin amid intense competition: SVSA commenced agri-graintrading business from fiscal 2016, and fiscal 2017 is the firstfull year of operations. Revenue was INR35 crore till January 31,2017 and scale of operations is expected to improve over themedium term. Scale, although improving, is likely to remainaverage given the industry competition and large fund requirementto support growth.

The agri-grain trading business is highly competitive andfragmented due to the presence of several unorganised players.This restricts the players' bargaining power and profitability.Operating profitability is hence expected to remain low due totrading nature of operations and intense competition in theindustry.

* Average financial risk profile: Networth is expected to remainlow over the medium term due to low profitability leading tomodest accretion to reserve. The firm has contracted largeworking capital debt to support revenue growth. The capitalstructure and debt protection metrics are expected to remainbelow average in the near-to-medium term.

Strength* Promoter's experience: Benefits derived from the promoter'sdecade-long experience will continue to support the business.Outlook: Stable

CRISIL believes SVSA will benefit over the medium term from thepromoter's experience. The outlook may be revised to 'Positive'if increase in revenue and profitability results in sizeable cashaccrual. Conversely, the outlook may be revised to 'Negative' iflow cash accrual or inefficient working capital managementweakens financial risk profile, particularly liquidity.

Rajam Srikakulam, Andhra Pradesh-based SVSA is a proprietorshipfirm set up in 2015 by Mr. Surya Prasad. It trades in pulses,jute and waste paper.

STARCHEM POLYTRADE: CARE Assigns B+ Rating to INR27.75cr Loan-------------------------------------------------------------The ratings assigned to the bank facilities of Starchem PolytradePrivate Limited are constrained on account of its thinprofitability margins which is susceptible to volatility inprices of traded goods and foreign exchange fluctuations, weakdebt coverage indicators and small net worth base leading to highleverage. The ratings are further constrained on account ofworking capital intensive nature of operations and its presencein highly fragmented, competitive and cyclical Man-Made Fiber(MMF) industry.

The ratings, however, derive strength from the experienced andresourceful promoters and long track record of operationof the company having established relationship with suppliers.The ratings further derive comfort from diversified customer baseand locational advantage of SPPL.

Ability of the company to grow its scale of operation along withsustained improvement in profitability margin along withefficient working capital management shall be the key ratingsensitivities.

Detailed description of the key rating drivers

Key Rating StrengthsExperienced and resourceful promoters: SPPL was prompted by Mr.Raj Kishore Sharma and Mr. Akhilesh Sharma who have experience ofmore than 15 years in yarn trading business. Moreover, thepromoters have supported the operation via infusion of funds inform of equity capital of INR10.25 crore during FY14-FY16.

Diversified customer base: SPPL has customer base of more than300 with top 10 customers contributing nearly 15-30% of its totalsales over past two years (FY15-FY16) thereby reflectingdiversified customer base. Moreover, SPPL benefits from locationadvantage due to its presence in Surat which is one of the majortextile hubs in the country and accounts for major portion of thepolyester yarn production in India.

Key Rating WeaknessSusceptibility of its profitability to volatile commodity pricesand foreign exchange rates: During past three years (FY14-FY16),the total operating income of the company has witnessed avolatile trend due to volatile prices of its products(commodities) which are crude derivative. However, PBILDT marginshave remained largely stable over the same period. Although, itcontinue to remain very thin due to trading nature of itsbusiness. The manmade yarns are the major goods being traded bySPPL. These goods are derivatives of crude oil and are thussubject to inherent price volatility. Moreover, SPPL largelyimports its products from overseas markets and in absence ofactive hedging policy, it exposes to foreign currency fluctuationrisk.

Weak financial risk profile marked by thin profitability, weakdebt coverage indicators, and small net worth base: The overallgearing ratio of the company remained high, although it improvedfrom 3.14 times as on March 31 2014 to 1.91 times as on March 31,2016 due to infusion equity capital by the promoters.Furthermore, due to low profitability and higher reliance onexternal borrowings, SPPL's debt coverage indicators, i.e.interest coverage and total debt to GCA have, remained weak overpast three years ended FY16.

Working capital intensive nature of operation leading to tightLiquidity: SPPL's majorly imports by utilizing its Letter ofCredit facility and it does not get any credit from itssuppliers. On the contrary, SPPL gives clean credit of nearly 30days to its customers due to limited bargaining power andcompetitive nature of trading industry. Moreover, with relativelylong transit time for imports, SPPL keeps nearly 3 months ofinventory to serve its customers which further intensify itsworking capital requirement. The liquidity position of SPPLremained tight marked by modest current ratio of 1.32 timesas on March 31, 2016, high gross current assets days of 135 daysduring FY16 and nearly full utilization of its workingcapital limits for past 12 months ended December 2016.Presence in commoditized & fragmented market leading to thinprofitability: The MMF industry being very fragmentedconsequently suffers from high competitive intensity whichrestricts the profitability margin of the industry playersincluding SPPL.

Incorporated in 2006, SPPL was prompted by Mr. Raj Kishore Sharmaand Mr. Akhilesh Sharma. SPPL is primarily engaged in the tradingof polyester yarn, nylon yarn, viscose yarn and other manmadefibers. SPPL also has owned warehouse of approximately 20,000square meters located at Village: Mangrol near Surat (Gujarat).The company also does manufacturing of monofilament yarn frommother yarn through splitting process with an installed capacityof 150 Metric Tons per month (MTPM) which it sells under thebrand "Starlon".

As per the audited results for FY16, SPPL reported a totaloperating Income of INR229.88 crore (FY15: INR261.96 crore)with a PAT of INR0.18 crore (FY15: INR0.14 crore). As per theprovisional results during 8MFY17, SPPL registered sales ofINR162.00 crore.

The rating, however, draws comfort from experienced directors.Going forward, the ability of the company to improve its scale ofoperations while improving its profitability, capitalstructure and managing its working capital requirement shall bethe key rating sensitivities..

Detailed description of the key rating drivers

The total operating income of the company declined on y-o-y basisin the last 3 FYs (FY14-FY16, refers to the period April 1 toMarch 31) on account of decline in quantity sold. Theprofitability margins of the company remained low mainly onaccount of low value addition and highly competitive nature ofindustry wherein there is presence of a large number ofplayers in the unorganized and organized sectors. The capitalstructure of the company stood leveraged on account of lownetworth base and high dependence on borrowing to meet theworking capital requirements. The debt service coverageindicators stood weak due to high dependence on borrowings tomeet working capital requirements and low profitability margins.The working capital cycle of the company elongated mainly onaccount of increase in average inventory holding of the company.Moreover, the working capital borrowings were 80% utilized forlast 12-months period ended November 30, 2016.

The company is exposed to raw material price volatility due tovolatility experienced in the prices of lead. Since there is along time lag between raw material procurement and liquidation ofinventory, the company is exposed to the risk of adverse pricemovement resulting in lower realization than expected.

The company is exposed to foreign exchange fluctuation risk asthe company is mainly high imports and realization is completelysold in the domestic market.

Bhiwadi-based (Rajasthan) Sumetco Alloys Private Limited (SAPL)was incorporated in 1996 by Mr. Priyan Bhandari, Mr. N. KBhandari and Mr. Goldee Bhandari. All graduates by qualificationand Mr. N.K. Bhandari and Mr. Goldee Bhandari have an experienceof around two decades through their association with SAPL and Mr.Priyank has an experience of more than a decade through hisassociation with this entity. SAPL is engaged in processing oflead from batteries and also engaged in trading of lead and leadalloys. The company procures lead and batteries through onlineactions and bidding and from traders. It also imports fromcountries like Saudi Arabia, UAE, Australia, etc. (importsconstituted of around 50% in FY16).

SAPL sells its products domestically to companies such as TataAutocomp GY Batteries, Aaryan Alloys, Grap Marketing PrivateLimited and also sells to local traders.

For FY16, SAPL achieved a total operating income (TOI) ofINR56.43 crore with profit after tax (PAT) of and INR0.12 crore,respectively, as against TOI of INR93.06 crore with PAT ofINR0.27 crore, in FY15. Furthermore, During FY17, the companyachieved TOI of 30.28 crore in 7MFY17 (refers to the periodApril 1 to October 31, based on the provisional results).

The ratings reflect decline in SSIPL's scale of operations andcredit metrics on account of decline in order book size andoperating margins. Revenue was INR168 million during FY16 (FY15:INR202 million), interest coverage (operating EBITDAR/grossinterest expense) was 0.9x (1.2x) and net financial leverage(total adjusted net debt/operating EBITDAR)) was 6.5x (5.1x).The ratings factor in SSIPL's long working cycle of 254 days inFY16 (FY15: 252 days) leading to high working capitalrequirements on account of its high receivables and highinventory days.

Liquidity position of SSIPL had been moderate with averageutilization of 73% for working capital limits during the 12months ended January 2017. There were six instances of over-utilization during the period, which were, however, regularizedin a span of 1-10 days.

The ratings, however, are supported by the company's promoter'sexperience of more than three decades in the fabrication anderection of transmission towers. Ind-Ra expects strongimprovement in the company's topline during FY17 as SSIPL hasindicated revenue of around INR136.51 million during 6MFY17(interim numbers). The company has pending order book ofINR506.2 million as of end-January 2017

RATING SENSITIVITIES

Negative: Deterioration in the overall credit profile could benegative for the ratings.

Positive: An improvement in the scale of operation along withimprovement in overall credit metrics could be positive for theratings.

COMPANY PROFILE

SSIPL was incorporated by Mr. R.K. Sharma in 1973. The companyis engaged in the fabrication and erection of transmission towersin West Bengal, Assam, and other north-eastern states. SSIPL isalso engaged in the trading of iron products.

Positive: Sustained and higher-than-expected operational andfinancial performance, and timely sponsor support could result ina rating upgrade.

Negative: Lower-than-expected operational and financialperformance, and absent sponsor support could result in a ratingdowngrade.

COMPANY PROFILE

SVPL operates a washery with a beneficiation capacity of 2.5million tonnes per annum and a 63-megawatt power plant based onwashery rejects and reprocessed rejects supplied by ACB (India)Ltd ('IND AA-'; Outlook Stable). The washery commencedbeneficiation operations in September 2015 and has stabilizedsince then. Meanwhile, the power plant commenced operations inOctober 2015 and is still in the stabilization phase.

UNITED TRADE: CRISIL Reaffirms B+ Rating on INR4MM Cash Loan------------------------------------------------------------CRISIL has reaffirmed its ratings on the bank facilities ofUnited Trade and Investments at 'CRISIL B+/Stable/CRISIL A4'.

CRISIL believes UTI will continue to benefit over the medium termfrom the promoters' industry experience. The outlook may berevised to 'Positive' in case of significant improvement in scaleof operations and profitability, and efficient working capitalmanagement resulting in substantial cash accruals. Conversely,the outlook may be revised to 'Negative' in case of deteriorationin the financial risk profile, particularly liquidity, mostlikely affected by low cash accrual or large working capitalrequirements.

Established as a partnership in 2011, UTI trades in timber. Thefirm, based in Mumbai, is promoted by Mr. Sameer Chhapra, Mr.Khalid Chhapra and Mrs. Razia Chhapra.

Profit after Tax (PAT) was 0.28 crore on net sales of INR10.06crore in fiscal 2016 as against PAT of INR0.3 crore on net salesof INR10.51 crore in fiscal 2015.

Key Rating Drivers & Detailed DescriptionWeaknesses* Modest scale of operations in the intensely competitive RMGsegment: With revenue of INR25 crores in fiscal 2016, ZF's scaleof operations is modest in the highly fragmented textileindustry. The RMG segment is highly fragmented due to low entrybarriers.

* Exposure to geographic and customer concentration in revenueprofile: ZF generates around 75-80% of its revenues from sale toits principal in Canada. This exposes the firm to significantgeographic and customer concentration risks.

Strengths* Promoter's extensive industry experience: ZF was established byMr. Jinu V, who has over 14 years of experience in the textileindustry. Over the years, promoter has established healthyrelationship with customers and suppliers.

* Moderate financial risk profile: ZF has moderate financial riskprofile as reflected by its gearing of 1.41 times as on March 31,2016 and the interest coverage of 2.11 times for fiscal 2016.However financial risk profile is constrained by the modestnetworth of INR 3.7 crores as on March 31, 2016.Outlook: Stable

CRISIL believes that ZF will continue to benefit over the mediumterm from the promoters' extensive experience and establishedcustomer relations. The outlook may be revised to 'Positive' ifsubstantial improvement in scale of operations and profitabilityleads to better cash accruals. Conversely, the outlook may berevised to 'Negative' if revenues or profits decline or stretchin the working capital results in stretched liquidity; or if anylarge debt-funded capital expenditure is undertaken, resulting inweakening of financial risk profile, particularly its liquidity.

Set up as a proprietorship concern in 2002 by Mr. Jinu V, ZF isthe sole Indian manufacturer of readymade garments for Canada-based brands, Horse and Ride, Boston Bug, and Ferry & Tail. ZF isbased in Tirupur (Tamil Nadu).

ZF reported Profit after Tax (PAT) of INR0.5 crore on revenue ofINR25 crores in fiscal 2016 as against INR0.3 crore and INR26crores, respectively in fiscal 2015.

=========J A P A N=========

TOSHIBA CORP: Wants to Sell Off Chip Business with No Job Losses----------------------------------------------------------------Kyodo News Agency reports that Toshiba Corp. wants to sell itschip business in a deal where the potential buyer will retain allthe workers currently employed, sources close to the matter saidFeb. 17.

According to Kyodo, sources said the stance is intended to allayconcerns both inside and outside the troubled company about thepossibility of major job cuts as a result of a foreign company orinvestment fund taking control of the chip business.

Toshiba had earlier decided not to sell any stake in its chipbusiness before the March 31 end of the current fiscal year, in amove that makes it certain the company will have a negative networth at the year's end, according to Kyodo.

The company last week estimated a loss of JPY712.5 billion(AUD6.23 billion) from its U.S. nuclear business in the April-December period on an unaudited basis and fell to a negative networth of JPY191.2 billion at the end of December, Kyododiscloses.

As reported in the Troubled Company Reporter-Asia Pacific onDec. 30, 2016, Moody's Japan K.K. downgraded ToshibaCorporation's corporate family rating (CFR) and senior unsecuredrating to Caa1 from B3. Moody's has also downgraded Toshiba'ssubordinated debt rating to Ca from Caa3, and affirmed itscommercial paper rating of Not Prime. At the same time, Moody'shas placed Toshiba's Caa1 CFR and long-term senior unsecured bondrating, as well as its Ca subordinated debt rating under reviewfor further downgrade.

The TCR-AP reported on Jan. 26, 2017, that S&P Global Ratingssaid it has lowered its long-term corporate credit rating onToshiba Corp. to 'CCC+' and its short-term corporate credit andcommercial paper program ratings on the company to 'C', all byone notch. All of these ratings remain on CreditWatch withnegative implications. S&P also lowered its senior unsecureddebt rating on Toshiba two notches to 'B-' from 'B+' and kept therating on CreditWatch negative. On Dec. 28, 2016, S&P placed thelong- and short-term ratings on Toshiba on CreditWatch withnegative implications at the same time as lowering the long-termratings, in response to Toshiba's announcement that it mightrecognize several JPY100 billion in impairment losses related togoodwill arising from its acquisition of a nuclear power businessthrough U.S.-based Westinghouse Electric Co. LLC, because thegoodwill far exceeded the company's initial estimates.

According to Kyodo, the sources said Toshiba now faces the riskof having to pay damages to those former employees of the U.S.nuclear power unit, Westinghouse Electric Co., if they file suitsclaiming harassment by former President Danny Roderick and otherexecutives.

The possible damages likely would not have a major impact onToshiba's financial results, according to the sources, Kyodorelays. But the matter could reignite concern over corporategovernance as Toshiba is already struggling to put behind it anaccounting scandal in 2015 involving three former presidentspressuring subordinates to overstate profits.

According to Kyodo, the Tokyo Stock Exchange put Toshiba shareson its watch list when that accounting scandal broke, and urgedthe company to strengthen its internal controls. The TSE hascontinued to deliberate over whether Toshiba should be removedfrom the list or delisted, and the new revelation of accounting-related harassment at its U.S. nuclear unit could impact thatreview.

On Feb. 14, Toshiba said it expects to post a loss of JPY712.5billion (AUD6.25 billion) from its U.S. nuclear business in itsresults for the April-December period. But Toshiba delayedissuing official, audited results, saying a whistleblower alleged"inappropriate pressure" at Westinghouse Electric over thepurchase of a U.S. nuclear plant construction company, the maincause of the massive loss, Kyodo says.

Toshiba Chairman Shigenori Shiga, an ex-president ofWestinghouse, and Mr. Roderick stepped down from their positionsto take responsibility for the loss, the report notes.

Mr. Roderick and other executives pressured the employees overthe asset value of the U.S. nuclear plant construction company itpurchased in 2015, Kyodo adds citing sources.

As reported in the Troubled Company Reporter-Asia Pacific onDec. 30, 2016, Moody's Japan K.K. downgraded ToshibaCorporation's corporate family rating (CFR) and senior unsecuredrating to Caa1 from B3. Moody's has also downgraded Toshiba'ssubordinated debt rating to Ca from Caa3, and affirmed itscommercial paper rating of Not Prime. At the same time, Moody'shas placed Toshiba's Caa1 CFR and long-term senior unsecured bondrating, as well as its Ca subordinated debt rating under reviewfor further downgrade.

The TCR-AP reported on Jan. 26, 2017, that S&P Global Ratingssaid it has lowered its long-term corporate credit rating onToshiba Corp. to 'CCC+' and its short-term corporate credit andcommercial paper program ratings on the company to 'C', all byone notch. All of these ratings remain on CreditWatch withnegative implications. S&P also lowered its senior unsecureddebt rating on Toshiba two notches to 'B-' from 'B+' and kept therating on CreditWatch negative. On Dec. 28, 2016, S&P placed thelong- and short-term ratings on Toshiba on CreditWatch withnegative implications at the same time as lowering the long-termratings, in response to Toshiba's announcement that it mightrecognize several JPY100 billion in impairment losses related togoodwill arising from its acquisition of a nuclear power businessthrough U.S.-based Westinghouse Electric Co. LLC, because thegoodwill far exceeded the company's initial estimates.

===============M A L A Y S I A===============

PRIME GLOBAL: Incurs US$912K Net Loss in Fiscal 2016----------------------------------------------------Prime Global Capital Group Inc. filed with the U.S. Securitiesand Exchange Commission its annual report on Form 10-K disclosinga net loss of US$911,522 on US$1.64 million of net total revenuesfor the year ended Oct. 31, 2016, compared to a net loss ofUS$1.59 million on US$1.91 million of net total revenues for theyear ended Oct. 31, 2015.

As of Oct. 31, 2016, Prime Global had US$45.81 million in totalassets, US$17.29 million in total liabilities and US$28.51million in total equity.

Centurion ZD CPA Limited, in Hong Kong, China, issued a "goingconcern" qualification on the consolidated financial statementsfor the year ended Oct. 31, 2016, citing that the Company has aworking capital deficiency, accumulated deficit from recurringnet losses and significant short-term debt obligations maturingin less than one year as of Oct. 31, 2016. All these factorsraise substantial doubt about its ability to continue as a goingconcern.

As of Oct. 31, 2016, the Company had cash and cash equivalents of$685,876, accounts receivable of $137,207 and incurred a net lossof $911,522 for fiscal 2016. As of Oct. 31, 2015, the Company hadcash and cash equivalents of $836,794, accounts receivable of$112,439 and incurred a net loss of $1,593,434 for fiscal 2015."We expect to incur significantly greater expenses in the nearfuture, including the contractual obligations that we discussedbelow, to begin development activities. We also expect ourgeneral and administrative expenses to increase as we expand ourfinance and administrative staff, add infrastructure, and incuradditional costs related to being an accelerated filer, includingdirectors' and officers' insurance and increased professionalfees," the Company said in the report.

A full-text copy of the Form 10-K is available for free at:https://is.gd/lAnRQR

About Prime Global

Kuala Lumpur, Malaysia-based Prime Global Capital Group Inc(OTCBB:PGCG), through its subsidiaries, is engaged in theoperation of a durian plantation, leasing and development of theoperation of an oil palm plantation, commercial and residentialreal estate properties in Malaysia.

===============M O N G O L I A===============

MONGOLIA: Reaches AUD5.5 Billion Economic Program with IMF----------------------------------------------------------A staff team of the International Monetary Fund (IMF) led byKoshy Mathai visited Ulaanbaatar during February 1-19 to continuediscussions with the Mongolian authorities on a set of economicpolicies that could be supported by IMF financial assistance. Atthe end of the visit, Mr. Mathai made the following statement:

"The Mongolian government and the IMF team have reached staff-level agreement on an economic and financial program to besupported by a three-year Extended Fund Facility (EFF) for SDR314.505 million (435 percent of quota), or about AUD440 million.Other international partners also plan to support thegovernment's program: the Asian Development Bank (ADB), WorldBank, and bilateral partners including Japan and Korea aretogether expected to provide up to AUD3 billion in budget andproject support; and the People's Bank of China is expected toextend its RMB 15 billion swap line with the Bank of Mongolia forat least another three years.

"The total external financing package will thus be around AUD5.5billion and will support the authorities' "Economic StabilizationProgram," which intends to restore economic stability and debtsustainability as well as to create the conditions for strong,sustainable, and inclusive growth, while protecting the mostvulnerable citizens.

"This agreement is subject to the confirmation of financingassurances, the completion of prior actions by the authorities,and the approval of the IMF Executive Board. The Board isexpected to consider Mongolia's request in March.

"Mongolia is well endowed with mineral resources, strongpotential in agriculture and tourism, and a young and dynamicpopulation. Its long-run future is promising, but in recent yearsit has been hit hard by the sharp decline of commodity prices anda collapse in foreign direct investment (FDI). Attempts to stemthe decline through expansionary policies proved ineffectiveafter a few years, and the economy is now stagnating, weigheddown by high debt and low foreign-exchange reserves.

"Fiscal consolidation is a key priority, as loose fiscal policyin the past was a major driver of Mongolia's current economicdifficulties and high debt. Budget deficits will be reducedsteadily, while priority social spending will be maintained: forinstance, the savings from better targeting the Child MoneyProgram will be used entirely to increase spending on the foodstamp program for the most vulnerable. Also, to boost revenue,the personal income tax will be made more progressive, with rateson only higher-income households increased.

"The Development Bank of Mongolia (DBM) will henceforth operatein an independent, purely commercial manner, as laid out in therecently passed DBM law, and the Bank of Mongolia (BOM) will notengage in additional quasifiscal activity, with the mortgageprogram now operating essentially as a revolving fund. Inaddition, the law on concession projects will be reformed, andthe public investment program (PIP) will be rationalized andbetter aligned with national development priorities.

"The authorities will adopt a set of important fiscal reforms toensure that budget discipline is maintained, building on theexisting framework for fiscal responsibility. These include thecreation of a Fiscal Council to provide independent budgetforecasts and costings of new policy proposals, and provisions togive the government sole authority to determine the total amountof spending in the budget, as well as to require Ministry ofFinance approval of any proposals to cabinet with a budgetarycost.

"Monetary policy will remain appropriately tight, given theobjective of price stability. Over time, however, as the economynormalizes, it may be appropriate to cut the policy rate ifexternal and inflation indicators permit. The exchange rate willcontinue to move flexibly, with intervention limited to smoothingexcessive volatility and preventing disorderly market conditions.A major priority will be the adoption of a new BOM law to clarifyits mandate, strengthen governance, and improve independence.

"Strengthening the banking system is a crucial part of theprogram, to ensure that the banks can support sustainable andinclusive economic growth. The authorities' first priority is toundertake a comprehensive diagnosis of the banking system toassess institutions' financial soundness and resilience. With theresults of this diagnostic in hand, the BOM will engage banks toensure appropriate restructuring and recapitalization, asnecessary. The BOM will complement these actions by strengtheningthe regulatory and supervisory framework, and government iscommitted to improving the deposit insurance system. Theauthorities are also committed to strengthening the regime forAnti-Money Laundering and Combating the Financing of Terrorism(AML/CFT).

"The authorities intend directly to boost economic activity andprospects by attracting new investment to major mines, and byimplementing an array of structural reforms to promote economicdiversification and improve competitiveness, especially inagriculture and tourism. The broad range of reforms envisagedunder the program have been developed in close collaboration withthe World Bank and ADB.

"The authorities' adjustment and structural reform program,supported by the large package of external financing, is expectedto stabilize the economy and lay the basis for sustainable,inclusive, long-run growth. By 2019, growth is projected to pickup to around 8 percent, as economic and financial conditionsimprove and key mining projects take off. Foreign exchangereserves should rise to a healthy AUD3.8 billion (above 6 monthsof imports) by the end of the program, similar to levels seen in2012, before Mongolia was hit by external shocks. Fiscalconsolidation will leave room for the banking sector, over time,to extend more credit to the private sector, consistent withprojected growth. These policies would also put public debt on adeclining path over the course of the program.

"The government's recently announced plan to engage with itsprivate external creditors to secure financing assurances for theprogram should help restore debt sustainability. Specifically,the financing parameters of the program assume that externalprivate creditor exposure will be maintained at its current levelover the program period, on terms consistent with debtsustainability, and gross financing needs will remain at prudentlevels during the post-program period.

"On behalf of the staff team, I would like to thank theauthorities for their warm welcome, and the constructivediscussions and excellent collaboration we have had over recentmonths, bringing us to today's successful conclusion."

MONGOLIA: Fitch Affirms Long-Term IDRs at 'B-'; Stable Outlook--------------------------------------------------------------Fitch Ratings has affirmed Mongolia's Long-Term Foreign- andLocal-Currency Issuer Default Ratings (IDRs) at 'B-' with aStable Outlook. The Country Ceiling is affirmed at 'B-'. TheShort-Term Foreign- and Local Currency IDRs have been affirmed at'B' and the senior unsecured rating has been affirmed at 'B-'.

Fitch has assigned a 'B-(EXP)' rating to the government'sproposed US dollar-denominated senior unsecured notes that willbe issued in part to fund an exchange offer for up to USD580m ofgovernment-guaranteed bonds issued by The Development Bank ofMongolia (DBM) that are maturing on 21 March 2017. The assignmentof the final ratings is contingent on the receipt of finaldocuments materially conforming to information already reviewed.

KEY RATING DRIVERSThe affirmation of the IDRs with a Stable Outlook and theassignment of the expected rating reflect the following keyrating drivers:

An IMF staff-level agreement and our estimate of Mongolia'sexisting liquidity resources provide Fitch sufficient confidencethat the sovereign can meet its immediate external debtobligations, including the forthcoming DBM maturity. Fitchbelieves the proposed IMF programme will improve Mongolia'smarket access and could also allow existing liquidity resourcesto be deployed without compromising the sovereign's ability toservice other maturing debt obligations, as initial disbursementsunder the IMF facility are likely to be insufficient to meet theupcoming DBM bond maturity.

The exchange offer allows DBM note holders until 1 March 2017 totender their notes. Under Fitch's Sovereign Rating Criteria, theexchange offer does not constitute a Distressed Debt Exchange(DDE). Although there is potentially a material reduction interms compared with the original contractual terms, primarilybecause of a maturity extension, the agency does not consider theexchange to be necessary to avoid a traditional payment defaulton the guaranteed DBM bond. Both factors would need to apply inorder for the debt exchange to be classified as a DDE under ourcriteria.

Mongolia's credit profile remains under pressure since ourdowngrade of the sovereign IDR to 'B-'/Stable in November 2016,but Fitch believes that the sovereign has the capacity and thewillingness to service its immediate debt liabilities, includingthe guaranteed DBM liabilities. This assessment reflectsMongolia's official foreign reserve holdings of USD1.3bn as ofend-2016 combined with our estimate of approximately USD400m ofremaining headroom under the Bank of Mongolia's bilateral swapfacility with the People's Bank of China (PBOC), though thelatter figure remains unconfirmed by the authorities.

The sovereign's ability to remain current on its external debtobligations is further supported by a recently proposed IMF-supported programme. On 19 February 2017, the IMF announcedstaff-level agreement on an Extended Fund Facility (EFF). Thetotal programme size is expected to be about USD5.5bn, includingUSD440m under the IMF EFF, up to USD3bn in multilateral andbilateral support, and an extension of the CNY15bn (USD2.2bn)PBOC swap facility. Disbursements under the programme aredependent on the completion of prior actions and board levelapproval, which is likely to occur in late March. Fitch believesthat there is a high likelihood of IMF board level approval,which would provide Mongolia additional flexibility to meet otherforthcoming debt maturities over the rating horizon.

Fitch's sovereign rating committee adjusted the output from theSRM to arrive at the final Long-Term Foreign-Currency IDR byapplying its QO, relative to rated peers, as follows:

- Macro: +1 notch, to reflect Mongolia's high medium-term growth prospects due to the development of the second phase of Oyu Tolgoi mine.- External Finances: -1 notch, to reflect weaknesses in Mongolia's external finances not captured in the SRM, including the very high net external debt burden and large external financing needs relative to reserves.

Fitch's SRM is the agency's proprietary multiple regressionrating model that employs 18 variables based on three-yearcentred averages, including one year of forecasts, to produce ascore equivalent to a Long-Term Foreign-Currency IDR. Fitch's QOis a forward-looking qualitative framework designed to allow foradjustment to the SRM output to assign the final rating,reflecting factors within our criteria that are not fullyquantifiable and/or not fully reflected in the SRM.

RATING SENSITIVITIESThe main factors that could lead to negative action, individuallyor collectively are:- Difficulty meeting imminent external financing needs, for example if multilateral and bilateral support is not forthcoming.- Failure to remain current on IMF programme guidelines following programme implementation.- Emergence of systemic financial stress

The main factors that could lead to positive rating action,individually or collectively are:- Implementation of credible and coherent macroeconomic policy- making that improves Mongolia's basic economic stability.- A track record of meeting stated fiscal targets, contributing to an improved outlook for government debt ratios.- Evidence of substantial improvement in the country's external liquidity position, for example through a build-up of reserve buffers.

Noticeably, the exposure amount carried by the top fivecommercial lenders -- KB Kookmin Bank, Shinhan Bank, Woori Bank,KEB Hana Bank and NH Bank -- came to KRW12.66 trillion as of theend of 2016, down KRW3.68 trillion from the year before, Yonhaprelays.

Yonhap says the reduced exposure is due to the banks' efforts toimprove their financial status through a massive debt write-offknown as a "big bath."

Yonhap relates that NH Bank reduced the largest amount of debtexposure by KRW1.14 trillion during the cited period, followed byWoori with KRW1.08 trillion, KEB Hana with KRW560.5 billion,Shinhan with KRW483 billion and KB Kookmin with KRW404.6 billion,the data showed.

Tuesday's edition of the TCR-AP delivers a list of indicativeprices for bond issues that reportedly trade well below par.Prices are obtained by TCR-AP editors from a variety of outsidesources during the prior week we think are reliable. Thosesources may not, however, be complete or accurate. The TuesdayBond Pricing table is compiled on the Friday prior topublication. Prices reported are not intended to reflect actualtrades. Prices for actual trades are probably different. Ourobjective is to share information, not make markets in publiclytraded securities. Nothing in the TCR-AP constitutes an offeror solicitation to buy or sell any security of any kind. It islikely that some entity affiliated with a TCR-AP editor holdssome position in the issuers' public debt and equity securitiesabout which we report.

A list of Meetings, Conferences and Seminars appears in eachWednesday's edition of the TCR-AP. Submissions about insolvency-related conferences are encouraged. Send announcements toconferences@bankrupt.com

Friday's edition of the TCR-AP features a list of companies withinsolvent balance sheets obtained by our editors based on thelatest balance sheets publicly available a day prior topublication. At first glance, this list may look like thedefinitive compilation of stocks that are ideal to sell short.Don't be fooled. Assets, for example, reported at historicalcost net of depreciation may understate the true value of afirm's assets. A company may establish reserves on its balancesheet for liabilities that may never materialize. The prices atwhich equity securities trade in public market are determined bymore than a balance sheet solvency test.

This material is copyrighted and any commercial use, resale orpublication in any form (including e-mail forwarding,electronic re-mailing and photocopying) is strictly prohibitedwithout prior written permission of the publishers.Information contained herein is obtained from sources believedto be reliable, but is not guaranteed.

TCR-AP subscription rate is US$775 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the samefirm for the term of the initial subscription or balancethereof are US$25 each. For subscription information, contactPeter Chapman at 215-945-7000 or Nina Novak at 202-362-8552.